The automotive industry is facing its worst year in decades, as it struggles to cope with the ramifications of the widespread industrial disruption caused by the coronavirus pandemic.

Because of social distancing measures, consumers are unable to visit car showrooms, while high-profile events like the Geneva Motor Show, which attracted 602,000 visitors last year, were cancelled. Moreover, consumers are generally reluctant to make big purchases at a time of such financial uncertainty.

In the US, new car sales declined approximately 35%, but the situation has been far worse in Europe – for instance, new car sales fell 85% in Italy, 72% in France, and 69% in Spain.

We decided to use the Commetric COVID-19 Business Impact Tracker to help us understand which business events within the automotive industry gained the most traction in the media during the COVID-19 crisis. Our free tool uses rule-based natural language processing (NLP) and machine learning to track more than 450 types of news-reported business events that affect companies and industries during the pandemic.

We analysed media data from thousands of outlets for the period 1 Jan – 08 April 2020, covering most publicly-traded companies in the US, and looked into the media resonance of the various activities within the automotive sector that took place in the context of COVID-19, i.e. the amount of media coverage that referenced car companies in relation to the pandemic.

We found that the most impactful business driver was operations, which featured articles primarily on production halts or unit closures.

Apart from identifying and categorising general business drivers, the COVID-19 Business Impact Tracker uses advanced NLP to disambiguate sentence structure and classify the business events that drive media coverage. Thus, the following chart shows the business events with the highest media share of voice within the top five business drivers for the automobile industry:

With regards to the biggest business driver- Operations, particularly prominent were Toyota, Honda, and Fiat Chrysler, which closed plants across the US and Canada. They also joined a rapidly growing list of car manufacturers like BMW and Vauxhall that are shutting down their European operations.

Some commentators noted that Britain’s automotive industry may never recover from the pandemic after car plants responsible for two-thirds of the UK’s annual vehicle output paused assembly lines.

Naturally, the financial performance driver included reports about stock falls, dividend cuts and slashed financial forecasts. But stocks of some automakers like General Motors, Ford and Tesla saw double-digit moves at the end of March due to a stock market recovery rally, fueled by hopes that Congress would pass its pending coronavirus stimulus plan.

The business strategy driver featured articles mainly about facility reduction plans: for instance, Nissan shuttered its Sunderland plant, Britain’s biggest car factory.

However, the business strategy driver also included some news on business expansion: for example, General Motors partnered with medical equipment maker Ventec to build ventilators at a GM plant in Kokomo, Indiana, as demand for ventilators is outpacing hospitals’ supply.

Toyota was the most often mentioned car company, as we discovered thanks to the Commetric COVID-19 Business Impact Tracker:

Toyota was mentioned that often because of its unit closures, but it also gained prominence for announcing that it will restart North American factories in early or mid-April, alongside Ford, Fiat Chrysler and Honda.

News around Nissan and Honda were also propelled by the labour driver, as the car companies said they had furloughed almost 10,000 workers each at their US operations.

Like General Motors, Ford and Tesla were also prominent because of the business strategy driver, which featured reports on their plans to produce ventilators – products which have been in short supply as the coronavirus pandemic grows.

Ford‘s plan was to build 50,000 simple medical ventilators at a components plant in Michigan over the next three months. Meanwhile, coverage around Tesla was boosted by the CEO driver, as Elon Musk, who famously tweeted that “the coronavirus panic is dumb” at the beginning of March, has promised to donate hundreds of ventilators.

Try out the free COVID-19 Business Impact Tracker for more insights into COVID-19’s impact on companies and industries.

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