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Friday, 04 September 2020 16:37

Expert Predicts Auto Industry Could Take 2 Years to Rebound to Pre-Pandemic Sales Levels

Written by Dave Boucher, Detroit Free Press
The automotive industry did not take as big of a hit as many predicted due to the coronavirus pandemic. But experts and analysts told Michigan lawmakers on Sept. 2 their future is still a bit tenuous. The automotive industry did not take as big of a hit as many predicted due to the coronavirus pandemic. But experts and analysts told Michigan lawmakers on Sept. 2 their future is still a bit tenuous. Eric Seals, Detroit Free Press

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It's going to take at least two years for auto manufacturers to restore the sales and production numbers seen before the start of the coronavirus pandemic, an industry expert told Michigan lawmakers in Lansing on Sept. 2.

Despite successful efforts from suppliers and manufacturers to keep their doors open and employees safe, staffing shortages and some overall drop in demand means the industry needs to keep adapting and working collaboratively, said Carla Bailo, president and CEO of the Ann Arbor-based Center for Automotive Research

 

"Everyone is predicting this year about 13 million [vehicles sold], pre-COVID we were about 17 million. We expect it's going to take another two years, but that's predicated on a good recovery and continued recovery throughout this year," Bailo said during a legislative hearing.

"Should we have another hit in the fall, we'll have to adjust those figures. So about two years to come back to where we were." 

 

Bailo joined Michigan manufacturers and industry authorities in briefing lawmakers on the pandemic's impact on the automotive world. Every speaker agreed the auto industry's ability to produce personal protective equipment helped save lives and jobs, but there are real and practical problems that operating during a pandemic will present for the foreseeable future. 

 

The discussion comes as every industry tries to maintain a tenuous grasp on operating during a pandemic. Gov. Gretchen Whitmer is expected to soon allow movie theaters, gyms and similar businesses to start operating again on a limited basis. But she's repeatedly warned she may need to institute another shutdown if coronavirus case rates spike again. 

 

Automotive manufacturing shut down like most industry in March, even as suppliers and large manufacturers looked for ways to produce vital health and safety equipment to fight COVID-19, the disease caused by the coronavirus. 

 

Any new halt in production, even a short one, would be crippling, said Brian O’ConnellGeneral Motors regional director of state government relations. 

 

"The shutdown had a huge impact on our industry and our company. And we cannot afford a shutdown. We cannot afford a week shutdown," O'Connell said.


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