When the auto industry hits rock bottom, how are countries around the world bailing out?

As the epidemic continues to spread around the world, more and more negative news is flooding the news end. In the auto industry, production and sales estimates for 2020 issued by various rating agencies are also becoming less optimistic.

And, while the epidemic has been effectively controlled in China, it has just begun overseas, especially in developed countries in Europe and the United States. It's predicted that Europe won't see a real peak until April, and the U.S. even later, possibly until late April or early May.

That is, the difficulties are just beginning, and the world could be ravaged by repeated outbreaks in the first half of this year. For that reason, the Tokyo Olympics, originally scheduled for this summer, have been forced to be postponed until 2021.

Global auto sales and production forecasts continue to be lowered

On Feb. 26 this year, when the new coronavirus is still mainly rampant only in China, the internationally renowned credit rating agency Moody's Investors Service lowered its forecast for global auto sales in 2020, saying that global auto sales will decline by 2.5 percent.

Moody's said China, the world's largest auto market, would take a major hit because of the outbreak. Auto sales in China are expected to fall 2.9 percent in 2020, down from a previous forecast of 1 percent growth.

By contrast, British research firm LMC?Automotive was more pessimistic, saying in their report that global light vehicle sales would fall by as much as 4.4 percent in 2020.

Today, however, it seems their predictions were overly optimistic. With the center of the epidemic shifting to developed countries in Europe and the United States, the world's most important car producers and consumers, such as Italy, France, Germany, Britain and the United States, have all been hit hard. Even India, Southeast Asia and other countries and regions have implemented strict closure initiatives.

As of March 24, 12 overseas car companies, including Volkswagen, Toyota, BMW, Daimler, Fiat Chrysler, Peugeot Citroen, General Motors, Ford, Nissan, Honda and others, have shut down or plan to shut down more than 100 factories, of which 90 percent are concentrated in Europe.

However, compared with the production side of the "locked up", the consumer side of the depression is more worrying. The stock market crash, the financial market crash, economic turmoil will directly hit people's desire to consume.

A few days ago, the German ratings agency ScopeRatings released a report, said the 2020 European market car sales will likely fall by 19%, the global new car sales will fall by about 9%.

J.D. Power, a well-known research organization, also released a forecast that the U.S. auto market in March may fall 25-40 percent year-on-year. in 2020, U.S. auto sales are expected to fall to 14 million units from 16 million units for the year.

HIS?Markit also released a set of forecasts that suggest the new crown epidemic will cost new car production in the first quarter by about 2 million units, or about 40 percent of total first-quarter global production.

Nippon Keizai Shimbun's projection was the most pessimistic, stating that global auto production in 2020 may fall nearly 40 percent year-on-year.

Loan guarantees, financial support, countries to introduce rescue policies

Automobile is the pillar industry of the national economy, can drive the industrial chain as well as the surrounding more than 100 related industries **** with the development of the 1:10 multiplier effect to pull the economic growth of the automotive industry, the automotive industry, each output of 1 unit, can be driven by the overall increase in the output of the other economic segments of the 10 units.

Therefore, no matter when, in which country, promoting the healthy development of the automobile industry is an important means to ensure economic stability. Now with the global automobile industry hitting rock bottom, the world's automobile industry countries have also launched policies to deal with it.

China was the first to be affected by the epidemic, and the rescue policy also came out the earliest.

On February 15, the magazine "Seeking Truth" published a report titled "Speech at the meeting of the Standing Committee of the Political Bureau of the Central Committee to study the response to the new coronavirus pneumonia epidemic," emphasizing the need to actively stabilize the traditional consumption of automobiles and other bulk consumption, and encouraging automobile purchase-restricted areas to appropriately increase the quota of automobile license plates and drive the consumption of automobiles and related products. And then, the Ministry of Industry and Information Technology also issued in the "on the orderly promotion of industrial communications industry enterprises to resume work and production of the guiding opinions" on the review.

Cities such as Foshan, Guangzhou and Changsha have introduced subsidy policies for car purchases, and first-tier cities such as Beijing, which have strict restrictions on purchases, will also increase the issuance of number plates. It is believed that more favorable policies will be introduced from the central to local levels in the near future.

In foreign countries, the French government recently promised to provide loan guarantees for PSA and Renault, and even brewing nationalization. It is reported that the French government holds 15% of the shares of Renault and 13.68% of the shares of Peugeot Citroen Group. In response, Renault responded that it may seek government guarantees in the face of the crisis, but it is not considering nationalization.

Germany, March 20, Federal Deputy Chancellor and Minister of Finance Scholz said: "in the face of the impact of the epidemic, the Cabinet government on the 23rd through the 150 billion euros of additional budget in order to protect the stability of the business operation". In addition, German politicians further asked the government, to protect domestic enterprises from foreign takeover.

It is understood that Germany as Europe's largest and one of the world's most important automotive industry cluster, the impact of the epidemic is equally severe. Confirmed cases have been found at BMW's Munich research and development headquarters, Audi's Ingolstadt headquarters and Volkswagen Group's Wolfsburg headquarters.

On March 23, a tripartite letter was sent to the U.S. Congress by major U.S. automakers, parts suppliers, and auto dealers, urging the government to provide "robust credit tools" to ensure that the automotive industry has sufficient cash flow to respond to the risks. In addition, the U.S. auto industry is seeking a $2 trillion stimulus package from the federal government in the face of a potential economic slowdown caused by the epidemic.

U.S. auto sales are expected to fall 90 percent in March as a result of the outbreak, with about 95 percent of auto plants closed and about 165,000 workers affected. In response to the request, President Donald Trump made it clear that he would lend a hand.

In addition, the South Korean government has also promised to speed up customs clearance, arrange for freight transportation and provide the necessary liquidity support for the auto industry. The automotive workforce is said to account for about 12 percent of South Korea's total employment.

The new coronavirus is not only a blow to people's health, but also to the socio-economic level, where timely government intervention can play a key role in the industry and market confidence.

And, the impact of the epidemic is not localized, although the situation in China has improved, but the overseas epidemic is getting worse, will also lead to China's supply chain system can not operate normally. Therefore, it is expected that the automotive industry will be able to come back to life as soon as possible with the ****same efforts of countries all over the world.

This article comes from the author of the automobile home car family number, does not represent the views of the automobile home position.