The continued closure of car plants across Europe and North America will cost the auto industry more than $100bn (£82bn) in lost revenues if the shutdown lasts until the end of April.
All major European carmakers have suspended production because of disruption caused by the spread of the coronavirus and if this continues as expected until the end of April, this will account for $66bn (£54bn) in lost sales in Europe, or 2.6m cars. In North America this will account for 2m cars, and lost sales of about $52bn (£42bn).
The calculations have been made by Ian Henry, the owner of the consultancy AutoAnalysis, who produces forecasts for the industry body, the Society of Motor Manufacturers and Traders (SMMT), as first reported in the Financial Times.
Assembly lines ground to a halt in March as the lockdown across Europe disrupted global supply chains, and analysts predicted large falls in demand in all key markets.
All volume manufacturers from BMW to Toyota and Nissan to Jaguar Land Rover sent their workers home after the worsening outbreak on the continent led companies to examine the health implications for their workers.
The story was repeated across North America as the Detroit carmakers, including General Motors, Ford and Fiat Chrysler, shut down their plants.
Auto firms initially closed their sites for a number of weeks, saying they would keep the situation under review, but the shutdown is anticipated to last longer than first expected.
Henry predicts that each additional week of plant closures in Europe will cost the industry an extra $8bn (£7bn) in lost production value and similarly $7.5bn (£6bn) in North America.
Experts have warned that Britain’s car industry, already struggling before the pandemic because of falling sales, a shift away from diesel vehicles and Brexit uncertainty, may never recover from the coronavirus crisis.
Britain’s new car registrations for March, due to be released by the SMMT later on Monday, are expected to show a drop of more than 40% compared with a year ago, a fall bigger fall than experienced during the financial crisis.
March is traditionally one of the strongest months of the year for new car sales as it is one of two months where new number plates are released.
The post Car plant shutdowns may cost auto industry more than $100bn appeared first on The Guardian.