McKinsey & Company published an article, titled, “Beyond coronavirus: The road ahead for the automotive aftermarket,” in which they describe both the near- and long-term futures of the automotive aftermarket industry in relation to the current global pandemic. The Automotive & Assembly Practice at McKinsey & Company assessed previous crises to quantify performance indicators during a financial downturn.
The article states that “COVID-19 has created an economic situation that is fundamentally different from any previous crisis.” The article goes on to say that the coronavirus crisis will introduce factors not previously seen in previous crises, such as lower retail traffic, increases in digital channels and ecommerce, and lower public transportation use.
Furthermore, “the McKinsey Global Institute created nine scenarios illustrating how the world economy might evolve.” Summarizing two of these scenarios, the automotive aftermarket could potentially see a decline in 2020 revenue ranging from 3-15 percent in the United States.
The article also outlines potential structural changes to the aftermarket industry, some of which include ecommerce and digital channels, automation, supply chains, and consumer preferences. In closing, the article states that it will take time for the automotive aftermarket to return to 2019-levels of revenue.
Read the full article here.
