Vehicle Pricing After Lockdown: What to Expect
Vehicle Pricing After Lockdown: What to
Expect
The
nationwide lockdown has had an effect on virtually every industry in our
country. How will it affect the automotive industry? Read on to see what we
predict for the coming year and how we answer some of your burning questions
about the effect COVID-19 will have on the automotive industry.
Will I still be able to
buy a car?
The good news is that you will still be able to buy a car
during the lockdown. In fact, the car buying process remains virtually
unchanged up until the point of delivery. In this situation, your new car will
be stored at the dealership until their doors are opened again and the lockdown
has been lifted. You will also unfortunately not be able to test-drive your car
before buying it, but that being said, most dealerships have a virtual or
digital showroom where you can view the reviews, specs and details of your car.
Will cars be more or less
expensive than before?
This question is a bit harder to answer with certainty than
the last. Experts have mixed opinions on what the aftermath of COVID-19 will
mean for car sales. Some think that we will be seeing a spike in car prices,
while others think that this is the perfect time to purchase a new car thanks
to lower prices and better incentives.
There could be a potential shortage in the supply chain due
to the mass shutdown of manufacturing plants and the slowing of production.
Many factories and manufacturers are not prepared to face a slowdown in
production. This means that car prices heavily depend on the sourcing and
production of parts and vehicles. Many automotive brands have resorted to air
freight instead of ships to import and export parts and vehicles, which is much
more costly and could contribute to the rise of vehicle costs. While it may
still be too early to judge, we are holding out hope that the automotive
industry will work to keep car costs reasonable.
Will fuel prices rise
because of the virus?
The recent price drop of fuel has been quite a relief for
essential workers who still need to commute to and from work. However, experts
warn that this might only be temporary and that we could see a massive spike in
fuel costs as soon as COVID-19 epidemic is under control. Efficient Group economist, Dawie Rood,
explains that “[the] moment the virus epidemic is back under control and the
Chinese economy springs back into action, the price of crude oil will spike and
we will see massive fuel price hikes in South Africa.”
Our prediction for 2020
As we’ve mentioned earlier, it’s still too early to know
exactly what the impact of COVID-19 will be on the automotive industry, but we
remain hopeful. Despite the prediction that vehicle sales will decline and
production will slow, we know that we will find solutions to deal with and
eventually overcome this difficult time.
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