The covid-19 impact on the economy is disastrous and yet to worsen. It is assumed that global GDP loss could be around dollar 9 trillion. Various sectors have been badly affected, automobiles being the worst hit.
Heavy indebtness of major automobile companies accompanied with drop in sales, being one of the major reasons as this might result into a liquidity crunch, forms a gloomy picture for automobile and ancillary industry. Also, Germany, one of the major hubs of automobile related goods is strongly hit by the pandemic leading to raw material procurement difficulty.
It is feared that things may continue to worsen in the first quarter of 2021 as people might not want to spend money on luxury goods. With demands still dropping, problems might be experienced on the sales front forming the assumption that the sector may not see heavy growth for at least two more quarters. On the contrary, some believe sales to slightly zoom up as people would prefer personal vehicles. To this, the former contradict by stating the cut salaries of the people and their inclination towards cutting on extra expenses. Under such conditions they would avoid the four wheelers, the demand graph of two wheelers is, however, predicted to go up!