![]() Lockdown stringencyĪcross countries, the severity of regulatory measures has significantly decreased compared with the first lockdown, according to Oxford University’s COVID-19: Government Response Stringency Index (as of November 18, 2020) (Exhibit 1). The regulatory differences between the two lockdowns can be best understood by looking at four different categories: lockdown stringency, restrictions for automotive retailers, car purchase incentives, and general economic support. ![]() Germany, Italy, and Spain are exposed to more “favorable” regulatory circumstances, while the United Kingdom and France will again cope with closed dealerships. Thus, we expect the shutdown to have a lower impact on automotive retailers, but it will differ by country. This is also reflected in our car-buyer research that shows the current EU lockdown is perceived as less challenging and disruptive than the one in the spring with 44 percent of respondents stating it as being slightly less challenging, 21 percent as slightly more challenging, and the remaining 35 percent as the same as the first lockdown. The current lockdown, enacted in November 2020, comes from a different starting position-it is expected to be shorter, have fewer restrictions, and offer more car subsidies from the government. How do the lockdown restrictions compare? ![]() Will a second lockdown be as severe or less consequential for automotive retailers in the largest European (EU5) vehicle markets? This article shares our newest automotive-buyer insights to provide a perspective on the expected impact of the most recent shutdown in Germany, the United Kingdom, France, Italy, and Spain. Given the speed and nature of the pandemic’s impact, automotive retailers suddenly faced significant uncertainty, further exacerbated by unclear regulations (for example, the scope and length of closed dealerships) and delayed government financial support such as furlough schemes, increase in car purchasing subsidies). Despite a strong recovery in the subsequent months, new vehicle sales are still down 28 percent as of October year-to-date in the EU5 economies (Germany, France, Italy, the United Kingdom, and Spain). In April, the United Kingdom, Spain, and Italy were more than 95 percent below the previous year’s levels, while Germany lost 61 percent and France lost 89 percent of new car sales compared with the previous year. In addition, OEMs reduced their production volumes in Europe by 16 percent compared with their originally planned 2020 volumes. This came as a result of rising economic uncertainty and health concerns as well as many dealerships, service workshops, and registration offices being forced to close without much time to prepare for the new situation. European consumers’ purchase intent for new vehicles dropped by 24 percentage points in May 2020 compared with prepandemic levels. The lockdown in spring 2020 had a severe impact on automotive retailers.
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