The automotive industry has been dealt a huge blow by the coronavirus disease 2019 (Covid-19)—perhaps greater than any other global catastrophe in the modern times.
Many car manufacturers were compelled to shut down operations at plants, dealerships, and other touch points in the auto supply chain, all in an attempt to curb the effects of the virus.
Many of these manufacturers work to ensure they are not in the red when operation resumes, some modified their business model, either providing customers with a way to purchase cars while remaining on lockdown or extending warranty and maintenance, and even payment periods for customers.
Others chose to shift their operations to providing medical equipment and protective gear.
How long these new measures will last for the manufacturers remains to be seen. Should they prove viable to a car company’s profitability, perhaps some of them will continue even when lockdown lifts, or perhaps not. One thing’s for sure: these measures have certainly changed the way many car brands do business, and may even inform us what the future of travel and transport will look like in a post-Covid-19 world.
Charlene Rohr, Senior Research Leader at Rand Corporation, an American nonprofit global policy think tank, posits some of the pertinent questions being asked by pundits as the automotive world attempts to put the current crisis in its rearview mirror. Here are some of those questions:
- Will work from home continue, or will people rush back to their offices for more in-person interactions with colleagues?
- Will people favor more individual modes of travel, like bikes or cars, and reject mass transport services, such as trains and buses?
- Will prefer to leave large cities and opt to live in smaller towns and villages—or vice versa?
“Answers to such questions are important, because if people travel less or travel differently after Covid-19, less investment could be needed for future transport infrastructure,” Rohr continued.
In her blog post, Rohr admits that it may be too early to realize tangible answers, but visualizing different possible futures can help prepare the industry for what’s to come. She then suggests three possible futures:
- Road travel—and with it economic growth—will continue to flourish, just as it did before Covid-19
- Travel will diminish because of increased digital substitution (e.g. work from home, online banking, virtual schools, etc.)
- Only the rich will benefit from advanced technologies, as costs will be beyond the reach of most people
Future Travel Experience (FTE), a unique global forum for travel industry stakeholders, offers more concrete predictions in their own blog post. Although FTE mainly focuses their forecasts on the airline industry, some of them are applicable to the automotive world as well.
Social Distancing as Standard
Social distancing means keeping a safe distance (approximately six feet) from other individuals in any gathering space such as schools, churches, and mass transport vehicles. When mass transport resumes, passengers may be required to keep distance from each other, which means it could be the end to the overcrowded buses that we’re used to—or maybe not.
Less Manpower, More Automation
With the rapid evolution of artificial intelligence, a lot of transportation functions could end up being performed by machines and robots. You may have already heard about self-driving cars, but what about automated toll booths and parking lots?
These could very well become reality soon, bolstered by the fact that they support the aforementioned social distancing norms being promoted not only now, but in the future as well.
Vehicle operators could be required to implement new cleanliness standards for their vehicles to ensure they do not encourage the spread of the disease. Rigorous and systematic disinfection of cars and offering contact-free ways to pick up and hand off passenger fares could be heavily instituted.
Already, car makers are already coming up with ways to make their cars less prone to Covid-19 infection.
Connected Automotive World
We’re seeing a lot of our day-to-day functions shifting to the online world, from grocery shopping to food purchase and more, which suggests that much of the automotive industry could suffer the same fate.
As mentioned, some car makers are already allowing the purchase of cars to be conducted wholly online. As people become more accustomed to buying things on the Internet, passenger fares, ticket purchases, and other modes of payment may follow suit, and online travel bookings may increase in demand more so than we are used to now.
Most of these amount to speculation, but they could become reality sooner rather than later—the Covid-19 pandemic has made sure of that.
“However, no matter how the public ends up working, taking holidays, accessing services and what role transport and other infrastructure has in these activities, decisions taken in the short term need to be robust across a range of possible futures, however unthinkable they may be,” Rohr said in closing.
Photos from weforum.org