The Changing Transportation Landscape During COVID-19

COVID-19 has quickly changed the way we work and the way we consume, thus transforming the nation’s economy as a whole. Few people are flying, purchasing and renting cars, taking cabs or ride shares, or commuting to work. 

Adam Jonas, the transportation industry analyst at Morgan Stanley Research, has shared a number of key ways he thinks the transportation industry is morphing during this pandemic.

More Logistics Fleets

Thanks to social distancing, so many of us are depending on online retailers, digital logistics operations and e-commerce powerhouses like Amazon, Instacart and Fresh Direct for food and household goods. The massive dependence on these retailers has shone a spotlight on the need for even more local and last-mile services. Drone delivery, anyone? 

Fewer Vehicle Makers

There has definitely been a push for the auto and truck industry to shrink and consolidate. Volkswagen’s Traton truck subsidiary made a bid for Navistar. Fiat Chrysler Automobiles and Peugeot have decided to merge. Even Nissan and Renault have had talks around potentially converting their alliance into a singular company. It will be interesting to see what happens next on this front.

Sales and Service Processes Will Evolve

Online transactions and digital marketing play a huge role in how dealers not only offer service and repairs, but also how they engage with customers and make vehicle sales. Tesla, for example, is already ahead of the game in figuring out how to deliver and service vehicles with minimal human interaction. There are also fewer salespeople to help conduct sales. According to AutoNation, dealers have had to lay off 7,000 workers this month because its sales fell 50 percent.

Less Car Sharing

Jonas posed an interesting question when he asked whether the coronavirus would lower the public’s willingness to rely on the behavior of the passenger that occupied the vehicle on the previous trip, or during a shared trip. What do you think? 

There’s no question that COVID-19 has affected all forms of public transport, including ride-hailing and sharing services, buses, trains, and airplanes. In fact, this aversion to mass travel may encourage some consumers to purchase a vehicle for their own private use. 

Restructured Supply Chains

It’s definitely a given that vehicle manufacturers will have to reassess “vulnerable spots in their supply chain from the perspective of leverage, working capital, logistics and geographic risk,” according to Jonas.

What other ways do you think the transportation industry will change in light of the coronavirus pandemic? Share your comments below.

For more information about the trucking industry and the coronavirus be sure to check out this blog post: The Life of a Truck Driver in the Midst of COVID-19