The consulting firm Ernst & Young (EY) believes that as a result of the Coronavirus-crisis with a “never-before-seen sales and profits slump” in the auto industry. “The auto industry is in deep slide in the red Numbers”, expected, Constantin M. Gall, Director at EY, Automotive & Transportation.

Even if the production and sales started again soon, will need the industry a long time to reach the pre-crisis level. “Because a significant rise in unemployment, corporate insolvencies and loss of income will dampen the demand,” said Gall. It is, therefore, the introduction of government incentives would be necessary.

suppliers to keep the chain, the Achilles heel of the entire industry

The highly complex System of car industry overall, capable to be the biggest challenge. More to Worry about than the manufacturer of the Advisor to the smaller, less financially strong companies in the automobile industry.

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While the big corporations on a large financial cushion and a production break of a few weeks, could bear, was to draw the supply chain is the Achilles heel of the industry as a whole, write to the Advisor in their current balance-sheet analysis for the major auto companies.

production could falter, because important parts of the

missing”, If in a few weeks the start-up of production, hopefully, again, will prove whether the kept supply chains,” says EY expert Peter foot. In the worst case, the plants of the car manufacturers would already after a few days still, because important parts are missing.

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Gall sees the Coronavirus pandemic, is already a “catalyst for a shakeout”. Both suppliers as well as traders he fears a wave of insolvencies. There will be mergers and Emergency mergers.

corporations last year low

EY regularly examines the balance sheets of the world’s major auto companies. The crisis accelerated a downward trend that had already begun before. According to EY analysis, the world’s largest car companies not worked in the past year so little profitable as in more than a decade.

The top spot in terms of profitability, Toyota has secured a in front of BMW and Volkswagen. Overall, the 17 largest automotive companies had, according to the study, about 226 billion euros of cash and cash equivalents – almost six percent more than the year before.

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