The Future of the Car Industry Post the COVID-19 Pandemic
The COVID-19 pandemic forced many bustling factories to close down and workers to idle at home. In April, most car industry experts and leaders anticipated a complete meltdown of business by the end of 2020. Surprisingly, there is a steady demand for cars since the lockdown got lifted.
Car manufacturing factories are up and running again, churning out vehicles in demand. Business analysts noticed a decline of 15% in the sale of cars in 2020 than the previous year, which could have been significantly worse. It shows that both the automaker industry and consumers were resilient. The American Society adapted to the pandemic much faster than most people had anticipated.
Experts believe that the car industry survived because people spent the money saved for exotic vacations to buy vehicles. But the automotive business has undergone quite a few changes during the pandemic. These changes might influence the future of the car industry, even when the pandemic is long gone.
Car Dealerships Have Shifted Online
As with most commodities, the sale of vehicles has also shifted online during the pandemic. More and more consumers are buying their cars online with minimal help from salespeople. The pandemic did not only force car dealerships to shift online, but they also came up with creative ways to interest the buyers, like offering 24-hour vehicle loans.
The COVID-19 pandemic has accelerated the digital buying patterns for customers who never imagined going online to purchase a vehicle. Experts feel that most consumers would prefer buying cars online in the future because of their experience.
The Internet has also made it easy to buy used cars since consumers do not have to go through the unpleasant aspects of purchasing at a car dealership. For example, they would not have to haggle or negotiate the price with the dealer. Nor would they are to visit several dealerships to look for a driveable model.
They can choose a car, get credit approval, and have the vehicle delivered to their doorstep while sitting comfortably on the couch. Most online car dealerships also offer a seven day trial period, which means consumers will have more time to test drive the vehicle. Experts feel that very few customers would probably go back to dealers to purchase used or new cars in the future.
The Bigger, the Better
The demand for large trucks and SUVs have gone up in the past few months. It seems that large vehicles make people feel more secure. Americans want something big and tough that they can drive off-road as well. Surprisingly, premium trucks in the range of $ 50,000-$ 85,000 are selling quite well.
Some experts also say that the pandemic has motivated Americans to indulge in off-road adventures. Many Americans have made some cash in stock markets and are using it to buy big vehicles like Ford Bronco and Land Rover defender. A lot of them have also started looking at my cars as escape pods for outdoor recreation in these uncertain times.
The increase in the sale of large trucks and SUVs has been followed closely by premium and super-premium sports cars. Car enthusiasts are buying enviable sports cars like the Porsche 911 and Corvette. It seems Americans have a newfound interest in muscle cars like Mustang and Camaro. Since options to have fun in 2020 have diminished, people are spending the saved money on dream cars instead.
Rise of Electric Cars
Electric cars have become a priority for automobile manufacturers in 2021. Consumers can expect to see more than 100 electric car models by the end of 2021. But experts are waiting to see whether consumers would go for them in the next 12 months. Most of them feel that it is the biggest bargain anyone has ever seen in the automotive industry.
It is not like consumers are begging for electric vehicles. Car manufacturers would have to wait and see if their massive investment in electric vehicles pays off. Tesla was once synonymous with electric cars, but that has already started changing. Most major car manufacturers are coming up with new electric vehicles in 2021.
At the moment, the sale of electric vehicles in the United States accounts for 1.7% of the market. But traditional car manufacturers are hoping to break Tesla’s autonomy and compete in the emerging market. General Motors had commented in November that they have plans to invest $ 27 billion in electric vehicles and produce 30 new models by 2025.
Ford has also started delivering its all-new electric SUV, Mustang Mach-E. Experts feel that the sale of electric vehicles will increase as the automotive industry starts to manufacture trucks and SUVs that Americans prefer over sedans or hatchbacks.
It seems that the changes in the automotive industry brought about by the COVID-19 pandemic would continue in 2021 and beyond. The industry has not only recovered but started to go up already in the new year. Experts anticipate the market to grow up to 8% in 2021.