While professionals in the American auto industry may not be optimistic about the near future, they appear to be more positive about prospects over the next 12 months to 24 months.
A recent survey to assess the outlook of auto industry insiders regarding the US economy during the coronavirus pandemic was jointly conducted by automotive and mobility association MICHauto, economic development firm The Right Place Inc. and the law firm Dykema. The automotive respondents of the survey included OEMs, Tier 1 and Tier 2 suppliers, and vendors of technology and other products to the US auto sector.
54% of these respondents had a negative outlook on the economy’s performance over the next 12 months. However, 46% of automotive respondents have a positive outlook for 24 months from now, while 41% had a neutral outlook for that period and just 13% having a negative outlook.
The views of these auto sector professionals reflect their anticipation of supply chain orders. In the next six months, 45% of auto respondents expected orders to decrease while 34% expected them to rise. In the next twelve months, 18% expected them to decrease and 46% expected them to increase. In 21 months from now, 71% expected to see a rise in orders.
Following the temporary suspension of operations at auto plants across the US due to the coronavirus-related lockdown this spring, the survey gauged how rapidly and easily automotive suppliers were able to resume operations after shutting down. 84% of respondents reported having to shut down operations during the pandemic.
Just 20% of respondents having to stop or curtail their operations once again, upon resuming operations, which indicated that the industry-wide reopening went off relatively smoothly, given the unprecedented circumstances.
Approximately 50% of respondents utilized the Paycheck Protection Program (PPP) loans offered by the government, while 16% opted for employee retention credits and 10% availed of an Emergency Income Disaster Loan (EIDL).