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The Pandemic Has Changed the Automotive Industry

The automotive industry is no stranger to challenges. From global competition, wars over access to oil, waning demand from buyers, the replacement of auto ownership allowed by rideshare options, and the 2008 auto industry bailout, the COVID-19 pandemic is only the latest of challenges confronting this industry. However, COVID-19 has had a historic impact on the economy in the United States and abroad. Below, we discuss how the pandemic has changed the automotive industry for better or worse. But first, let’s talk about how the automotive industry functioned before the pandemic.

The Car Buying Process Before the Pandemic

Before the pandemic, the car buying process was very person-centric. A potential buyer would go to a car lot and often be approached by several desperate commission-based salespeople. One of them would eventually take over the conversation and start asking questions about the buyer’s preferences. A family man going in to buy a minivan may have been schmoozed into purchasing a sports car instead.

Once the buyer reached a decision, he was whisked into the sales office to figure out financing. The deal is done with a final handshake.

Problems Caused by the Pandemic

Some industries were hit particularly hard by the pandemic. The automotive industry is one of these unlucky ones. The automotive industry was still recovering from the 2008 recession before the pandemic struck. Sales have not had major increases since 2015 in the U.S.

Experts predict that automotive factories around the world will close. They say that many automakers worldwide had at least 20% more factory capacity than they needed prior to the pandemic. Ultimately, this may lead to the close of factories, which is also expected to cause labor strife and political resistance. With more than 1 million people being employed in the automotive industry in the United States, mass layoffs may have a big impact on the economy. Additionally, some manufacturers may have to provide severance payments due to collective bargaining agreements or international contracts.

The pandemic has also disrupted supply chains, including international supply chains.

Change in Buying Preference

The pandemic has certainly changed buyers’ preferences about buying a car online. While recently, this was not the norm, today, more people are opting to buy a car online in order to minimize contact with others and their potential to contract a deadly virus during a routine transaction.

There are many aspects of the car buying process that can now be completed online, including:

  • Researching vehicles that are available in your area
  • Reviewing vehicle car history reports online or asking the dealership to email them to you
  • Making online appointments to test drive the vehicle
  • Applying for financing online
  • Getting an appraisal online if you are trading in your vehicle

Some companies also offer vehicle delivery to further limit contact, as well as no-hassle returns if the vehicle does not work out in the way you anticipated or if you didn’t have an opportunity to test drive the vehicle. One of the other perks of buying a car online is that you can compare cars side by side online. 

Buying a car online offers some additional benefits to buyers in today’s market, including:

  • The transaction is often faster when you buy online than if you buy a vehicle in person
  • You can minimize contact with other people by buying a car online
  • There is less haggling over price, so you can skip this frustrating aspect of the car buying process
  •  You don’t have to deal with a salesperson offering one price and then manager not signing off on it with an online purchase

Considerations for Buying a Car Online

If you are considering buying a car online, be sure that you take proper precautions to protect yourself, including:

  •  Request and verify the vehicle history report
  • Only work with reputable companies that have good reviews
  • Ask the company about their sanitation standards to protect buyers

Should You Buy a Car Now?

Whether you should buy a car now will depend on your particular circumstances and how the pandemic has affected your daily life. If you do not have access to public transportation and must still report to your jobsite and your current vehicle is on the fritz, you may have no other choice but to purchase a vehicle now. Likewise, if you had to change jobs and now need to commute to work, owning your own vehicle may be the most affordable way to protect your economic security.

Additionally, because of the public health risk, you may not want to use public transportation such as a subway, bus, or train to get to work every day. Even with physical distancing practices in place, it is unlikely that you will be able to use this type of transportation without coming into close contact with others.

There are several benefits to buying a car now, including the availability of competitively-priced vehicles, historically low interest rates and some companies advertising special offers. Because of some of the factors that are affecting the automotive industry, you may be able to get a good deal since manufacturers are trying to offload existing inventory to get much-needed cash. Consider your long-term goals, budget, and need for transportation when considering whether you should buy a car.

You should also consider buying a car online as an alternative to the traditional car buying process. This can help you limit your person-to-person contact with others and better protect you from contracting the coronavirus when companies put additional safeguards in place.


While the pandemic may have permanently changed the automotive industry, not all of these changes are bad. Auto manufacturers may further embrace globalization after realizing how interconnected the world is today. They may merge with others to provide greater protection to their continuity. Additionally, they may use more innovative ways to get their vehicles to end buyers, including offering options like buying a car online. You can take advantage of the current situation and secure a vehicle while not jeopardizing your health.