Background
 
The impact of coronavirus at short-, medium-, and even long-term will be significant for the automotive industry.

At short term, we will face a double crisis, as it never happened since the World War II (WW2):
- An extremely severe decline in production, with a total stop in many countries, however not on the same periods of time.
- An expected severe decline in the demand, as consumers will:
• Have much less money to spend on non first-necessity goods. Of course cars are considered by most people as a first necessity good but replacing their current one will not be a first necessity.
 Have deep fears that the “coronavirus crisis” can rebounce, even after it will be stopped, or new diseases can outbreak at any time.
 Take new habits, with new ways of working and leisuring.

The situation will depend very much on the governmental actions taken all around the world.
But using normal levers of in-place economic system cannot work.States will be led to take after-war measures (as it was
the case in Europe after WW2 with the Marshall plan) , such as nationalisations, debt write-off, restrictions, management of
boarders,…
These actions cannot be anticipated today and it is therefore very difficult to construct consequently close-to-real forecast.
 
However our company Inovev is building and will continuously update scenarios as realistic as possible to guide the automotive industry in their thinkings, strategies, and action plans.

In order to forecast the automotive production from now on, we have to take two factors in consideration:
- The loss of production due to the closures of the plant
- The decrease of purchases due to the crisis.Generally speaking, when there is a crisis (such as the 2008 financial
one), the loss during the crisis is not caught up and the production gets back after a while to its normal pre-crisis
position, without going higher than the pre-normal pre-crisis position.

Inovev has constructed a mathematical model, based on its 25 year experience in automotive statistics and analyses, to
understand what will happen and estimate the production quantities in Europe in the next months.
 
 
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