Companies across diverse industries and geographies have already started announcing shutdowns. According to leading data and analytics company GlobalData’s news database, the top sectors discussing store closures are automotive and retail, with the automotive industry being one of the worst hit. With the industry working on lean inventory, the prolonged shutdown of auto parts producers in China during the early spread had put the sector in jeopardy, says GlobalData, a leading data and analytics company.
Prominent auto manufacturers such as Volkswagen, Ford, Toyota, General Motors and Daimler were forced to shut down plants in mid-March 2020 with the contagion spreading rapidly across North America and Europe.
Aurojyoti Bose, Lead Analyst at GlobalData, says: “The major auto manufacturers were already reeling from the effects of the trade war on supply chains. The virus outbreak has multiplied problems for the industry with a cloud of uncertainty over the path forward.”
Retail companies, including Walmart, Nike and Adidas, also followed suit by announcing store closures. Walmart took steps to reduce store hours and close certain stores while others shut all stores. Technology retailer Apple also announced store closures in mid-March.
Bose adds: “The retail industry is not likely to reach the same levels of consumer demand post-COVID-19. In late March 2020, the pace of store closures increased rapidly, with several shopping centers drawing down the shutters. Retailers face the uncertainty of consumers embracing the reopening of stores due to inclinations towards social distancing.”
Travel bans have devastated the hospitality industry, with airlines preferring to ground aircraft rather than fly empty ones. In Europe, Middle East and Africa, airlines temporarily shut up shop, while in the US, companies have reduced operations as the airspace remains open. With travel demand hitting record lows, the aerospace industry is facing the brunt of the outbreak, with Boeing and Airbus suspending operations.
Bose concludes: “With no signs of slowdown in the spread of the contagion, closures and shutdowns are likely to be extended beyond April 2020.”