The COVID-19 pandemic is an incomparable, once-in-a-lifetime global public health, societal and economic disruption. Since it was identified in 2019, over fifty key countries have declared a national emergency in response to the coronavirus. It has affected just about every person and every industry on the planet, and the repercussions are projected to have impact for a long road ahead.
The global response to the pandemic had unprecedented impact on supply and demand in the auto aftermarket sector. However, despite numerous roadblocks, the industry has been resilient. The light-vehicle aftermarket has typically been the most recession-proof sector of the automotive industry. One reason for this is that when economic and other pressures causes drivers to delay the purchase of new vehicles, repairs on their current vehicles become more prevalent.
When attempting to ascertain the economic effects of COVID-19, it is tempting to look back at other significant economic downturns to draw comparisons, however it is important to note that the pandemic has created an economic situation that is fundamentally different from any previous crisis. We anticipate lagging impact and high uncertainty in many areas, including supply and demand, logistics and GDP, but we do not have a reliable model from which to draw reasonable conclusions.
Some key areas the pandemic has, and may continue to, impact include:
- People driving fewer miles (fewer collisions, less wear and tear on parts)
- Decrease in Parts/Repairs and even the shuttering of many body shops and garages
- Increase in eCommerce
- Decrease in Public Transportation
- Ongoing logistics issues
As a company which has always kept abreast of market and regulatory issues governing our industry, FJC has proactively reset our purchasing and production model from “just in time” to one in which we are holding an increased inventory on our most popular items. In this way we will be better equipped to achieve our most important priority: servicing our customers regardless of changes in logistics, supply or demand.