Business & Economics
Car Industry Update: Pandemic Hit Car Sales Records And Record Lowest July was the weakest month for new car sales since July 1998, according to newly released figures. Just 123,296 new cars were registered in the UK last month, according to data from the Society of Motor Manufacturers and Traders (SMMT). This is a 29.5 per cent decrease from July 2020. The decline was "artificially heightened," according to the SMMT because sales climbed during the same month last year when showrooms were open for a full month for the first time since the original coronavirus closure. However, due to the global scarcity of semiconductor chips and an increase in the number of people instructed to self-isolate, last month's total was 22.3 per cent lower than the 2010-2019 average for July. In the United States, the usage of plug-in cars is increasing, with battery electric vehicles accounting for 9.0 per cent and plug-in hybrids accounting for 8.0 per cent. The SMMT has reduced its forecast for total registrations for the year to about 1.82 million, reflecting an 11.7 per cent increase over last year's numbers but falling short of April expectations. 'Automotive Sector to Battle Against Shortages' Says SMMT CEO According to SMMT chief executive Mike Hawes, the automotive sector is still dealing with shortages of semiconductors and workers, which is limiting our capacity to transform a better economic outlook into a complete recovery. Changes to self-isolation regulations are expected in the coming weeks, which could aid firms dealing with employee absences throughout the sector, but the semiconductor shortage is expected to last at least the remainder of the year. As a result, they have marginally reduced the market forecast for 2021. The bright light, however, is the rising demand for electrified cars as customers respond to these new technologies in ever greater numbers, driven by more product variety, fiscal and financial incentives, and a pleasurable driving experience. What Car? magazine and website's editorial director, Jim Holder, reported that there is a strong desire to acquire a car, particularly as individuals reward themselves after a lockdown. However, while supply remains restricted, the issue for manufacturers and retailers in the meantime is to manage consumer expectations and establish pipelines. Eventually, supply issues will be resolved – but only those who have worked to meet customer needs will be able to reap the benefits. The Future of Automotive in the Post Pandemic The automotive sector will face many challenges from this pandemic. The issue of the shortage of hardware is still a problem with no foreseeable solution in sight. The industry is being throttled by the lack of semiconductor chips and staff. Luckily, the government is planning to mitigate some of the shortages by changing its self-isolation policy so that companies can bring in more staff from outside. Hopefully, this will help companies struggling because their workforce has been directed to self-isolate or was sent home due to pandemic related health problems. The situation in the automotive sector's future looks grim since many businesses are still struggling without new shipments or supplies of semiconductors for finished products or automobiles under construction. Experts believe that several players will go out of business and close their doors. This will leave more opportunities for companies that can keep strong throughout this pandemic. Companies that show the most strength by keeping a steady supply chain and workforce should maintain profitability even though they might get some competition from emerging businesses. How To Use Credit and Loans for Buying Cars in the Pandemic? Credit and loans can be one of the best ways to finance a new car purchase. However, car borrowers need to understand that there must be some credit history in your name to qualify for a loan. The use of credit and loans for buying cars in this pandemic is also a bit difficult to navigate if you have a bad credit history. There needs to be some credit to qualify for a loan, and there is little available credit right now because so many people are self-isolating. Many people believe that they can get cash for a car by using credit. But not all credit is the same, and it's important to understand what type of credit you're getting before you apply. Also, there's a common misconception that all loans require collateral like a house or an expensive piece of jewellery. However, if you have no collateral, many people can still be approved for a loan just by paying it off with their income tax return next year.