The pandemic will have considerably marked our lives, in addition to the social and medical impact of such a tragedy, the global economy has been turned upside down. Among the few (rare) winners of this period, we find the automobile manufacturers. During these very complicated months, stocks were at their lowest, allowing brands to inflate prices, but since then, the situation has been completely reversed.
If the sales figures are no longer as good, things seem even more complicated, with the elimination of thousands of positions at several leading manufacturers. This is particularly the case for Nissan. The Japanese brand has laid off nearly 9,000 people at the end of the year.
Nothing is going well in Europe either. The legendary Volkswagen group is reportedly on the verge of closing factories in Germany, a first in its century-old history. On the French side, it is the Stellantis conglomerate which is causing concern, with the recent resignation of the group’s CEO.
In the United States, Ford announced the voluntary departure of 4,000 workersmainly from its factories in Great Britain and Germany, thus “saving” jobs in the United States. Finally at Renault, jobs are threatenedbut no decision has been made by the brand.
Identical symptoms
While times are tough for automakers, the sources of this evil all seem to have their roots in the same place. The transition to electric vehicles has brought a sharp halt to the sales figures of several manufacturers.
The best example of this is undoubtedly that of Fiat. The Italian brand launched an electric version of its legendary Fiat 500. A few weeks ago it was withdrawn from sales, in favor of a thermal version. Consumers didn’t want it.
Too few buyers
For several specialists, the current crisis in the automotive world is not directly linked to this transition. At least, it did not start after the pandemic, but well before. The year 2020 will not have been than a euphoric breath in a very complicated period.
Faced with a lack of production, limited by the pandemic and the shortage of semiconductors that followed, manufacturers have regained control of the market. But today, stocks are far too large, and brands too numerous.
Fewer and fewer people are buying cars, especially new ones, so the market is completely unbalanced. Supply far exceeds demand, putting automakers in difficulty. The arrival of new players, notably Chinese, who offer models at knockdown prices, is unlikely to improve the situation.
For Simon Croom, professor at the University of San Diego, large firms are no longer able to achieve a “decent return” on their factories and machines. This has a “massive” impact on the profitability of the final product.
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