The pandemic has had a dramatic impact on a number of sectors, and with its globally integrated supply chain the automotive industry has been one of the worst affected with production halted and sales in a record slump.

Car production

The first lockdown in March 2020 saw car production in the UK and across Europe grind to a halt, with manufacturers faced with disruption to Chinese-made part imports and required to make their factories Covid-secure before being permitted to reopen. Overall, 2020 saw UK car manufacturing fall 29.3% to 920,928 units, the lowest total since 1984 according to trade group the Society of Motor Manufacturers and Traders (SMMT).

Production figures fell further in 2021, as whilst production facilities came back to life, supply chain issues continued to cause problems, with both Covid-19 and Brexit playing their part. The global computer chip shortage, in particular, caused significant issues for production with modern cars making use of upwards of 3,000 chips in each vehicle.

New car sales

As the world locked down in March and April 2020 and people faced an uncertain economic future, demand for new cars collapsed. Europe saw car sales drop by a staggering 80 per cent in April, and whilst sales did pick up later in the year and economies reopened the overall yearly figures saw UK new car sales down by around a quarter.

The situation barely improved in 2021, with overall sales figures of new cars up just one per cent over pandemic-ravaged 2020 and still 28.7% below pre-Covid levels with a myriad of challenges subduing the market.

Used car sales

The public’s economic fears and lockdown dealership closures led to the used car market falling 14.9 per cent in 2020, the worst figures since 2012 with 6,752,959 cars changing hands. There were green shoots of growth in the summer of 2020 as restrictions eased, but the market fell dramatically again in November and December as the second round of lockdowns were brought in.

Unlike the anaemic growth seen in new car sales in 2021, used car sales roared back in the second quarter of 2021 with used car sales up 108.6% on the year before and sales records broken in May and June. However, the situation was not to last as sales dipped a little in the second half of the year as people took stock of soaring used car prices that mean it remains a difficult prospect to find used cars for under a thousand pounds and further lockdowns.

The drop in production in 2020 and 2021 due to a combination of the pandemic, supply chain issues, and the global computer chip shortage has resulted in significantly higher prices for various used car options for sale in Essex and across the country, with the price of “nearly new” cars rising particularly rapidly.

The great acceleration

As with multiple industries across the globe, the pandemic has brought with it a great acceleration of automotive trends from digitalisation of processes to the shift towards electric vehicles.

Indeed, whilst new car sales were down in 2021, the one piece of good news for manufacturers was the speed at which consumers are shifting towards electric vehicles. Despite the pandemic, 2021 was the most successful year ever for plug-in vehicles, which grew to more than one in six new car registrations with more registered in 2021 than the previous four years combined.

Elsewhere, the supply chain issues has forced manufacturers to move towards a more open and transparent chain, with components tracked from start to finish. These changes will improve supply chain reliability in the future and are the continuation of changes that have been coming for more than a decade.

The pandemic has proved to be a difficult period for all parts of the automotive sector, but as the world reopens in 2022, changes that have accelerated over the last two years should means the industry bounces back at a quick pace.


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