What shape will the car industry be in after all this?

bigbob

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So the car industry like many has shut down and will be reflecting on what to do when it gets going again. How do people think it will change?

IMHO western world real GDP will drop a sixth to a quarter in the next few months and then have a bit of bounce but taking another 12/18 months to get back to where we were as a flat line and longer to make up the growth we lost. Fair enough but is a perpetual focus on quarterly real GDP growth what life is about and will western capitalism survive as it was? I doubt it as it is a broken model but I have a huge believe in collective human behaviour and we will come out of it in reasonable shape - I do not subscribe to the end of the (economic) world theories but it will be ugly for a while.

The car industry was on its knees a 25/30 years ago but has had a massive margin expansion (2008/10 blip aside) to where we were last month. This is over, the car market was already changing, there are too many product ranges, too many big, heavy cars, too many polluting engines etc etc. The future will be very different with much less consumer choice, more more government intervention and much less per capita car ownership in the west.

For me I have recently taxed and MOT'd my two summer toys (Maserati GranTurismo GTS Auto, Audi mark II TT V6 manual Roadster) and now realise I need to keep them and enjoy them for years to come whilst realising that most of my journeys in a handful of years will be in a battery buzz box. So be it.
 

bigbob

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Cheered me right up that @bigbob.

Answer, no one knows, too early to say.
..but things rarely stay the same and removal of pollution clouds over northern Italy etc will lead to further CO2 clampdowns. Personal carbon credits for flights might come out of this a bit further down the line meaning we don't need a third runway at LHR etc etc. You need a big shed to store a nice range of V8 Masers as they are likely to be highly in demand in a few years.
 

allandwf

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I think there will be more working from home, once the obstacles have been sorted, and a bit of infra structure is in place, we have done it for a few months, and it can be managed. This may impact on peoples car choice.
 

bigbob

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I think there will be more working from home, once the obstacles have been sorted, and a bit of infra structure is in place, we have done it for a few months, and it can be managed. This may impact on peoples car choice.
Agree all this nose to tail am/pm traffic in cities is a pain. New contracts might be 3+2 or 4+1 for office/home with output probably not actually reduced.
 

Felonious Crud

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Agree all this nose to tail am/pm traffic in cities is a pain. New contracts might be 3+2 or 4+1 for office/home with output probably not actually reduced.
Agreed. This is the thrust of some of our planning now. We've proved we can work at home, so do we need as many / as large offices?

With fewer flights, we can use guilt-offsetting to drive around in V8/12 cars with grins like a squadron of Cheshire Cats, carefree, vibrant and fabulous. No more of those tree-hugging hippies stealing our middle age with their batshit crazy ideas about traveling everywhere by bicycle. I'll have a stupid car and a sensible car (if I must), and be content. And fabulous.
 

highlander

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It seems to be accepted that airlines will significantly be pared down to maybe 1 or 2 per country after this due to the finance fallout so hate to say this but smaller car makers are IMO going to really, really struggle to bounce back from where we were 3 months ago to where we will be in 6 -9 months time. That unfortunately probably means Maserati too, hope I'm wrong but the cars we have now may well be the last of the line other than stock in garages. :(
 

midlifecrisis

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Ford, junk in the same sentence. That's not happened before.
And congratulations OP, your thread has the official seal of approval of a 'Wattie-zerohedge' link. You must be proud.
 

Ewan

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Public transport is a hot bed of infection. Private car use/ownership is the way forward. Happy days are ahead! Now, I must rush off and buy some shares in Aston Martin while they’re cheap and before the new Bond film comes out.
 

rivarama

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Ford - which carries $157bn of debt - was downgraded to junk bond last night... Its issued bonds are now trading at 75c on the $.
There’s a high chance Ford fall under chapter 11 and shareholders get wiped out...
 

philw696

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12,460
Interesting thoughts and I'm happy for you guys that can WFH must make life a lot more pleasurable.

What will happen with all the former Company office blocks ?

The owners of which I believe are a lot of Pension funds.

Could Pensions be the next Crash.

I'm only a Car Mechanic and I'm finding the Manufacturer work is going to be dead for a long time.
The future for me will be Service and Repairs and that I think will be Busy looking after what we have.
Just my thoughts so don't Castrate me.
 

DaveT

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Ford - which carries $157bn of debt - was downgraded to junk bond last night... Its issued bonds are now trading at 75c on the $.
There’s a high chance Ford fall under chapter 11 and shareholders get wiped out...
That may well happen in time but the aid package has at least postponed it for a bit: