The coronavirus pandemic is having a dramatic effect on the global automobile industry. While the immediate consequence is an abrupt halt to vehicle sales and cash flow due to confinement measures, automakers are optimistic that some sort of sales recovery is just around the corner. A much more lasting legacy of the virus is likely to be its effect on product strategy and next-generation vehicle development.
The biggest casualty is the self-driving concept and, closely linked to it, ride-sharing. In the new age of social-distancing and other forms of personal protection, demand for car- and ride-sharing has all but evaporated. All the major players (Ford, GM, Uber, ...) have postponed, cancelled or put on hold their programmes. There is one bright spot: some companies are shifting their driverless focus to goods delivery – a reversal of the robo-taxi future envisioned just a few years ago.
The big winner in de-confinement will be the electric vehicle. Electrification is clearly going to be the priority: for regulatory reasons, as new laws target carbon emission reduction; for automakers, who have already made huge investments in the technology; and for consumers, who may now be keener to embrace cleaner living and driving in the new post-Covid world.