Which new vehicles and technologies will survive as automakers plot post-COVID-19 recovery plans?
Will exciting electric vehicles like the Mustang Mach-E, GMC Hummer SUV and Cadillac Lyriq make the cut?
Will job losses and corporate carnage shock buyers into frugality and a new wave of small cars? What about the new Ford F-150 pickup expected this fall?
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Those and more questions are being decided as auto executives around the world count the cost of COVID-19 and decide what vehicles and technologies their companies need to recover from months of disrupted production and the recession that may follow.
Future vehicles can be divided into three categories:
- Those so close to production it would cost more to delay them than continue as planned.
- Others are “mission-critical,” too important to the company’s image or balance sheet to delay.
- Everything else is in the product plan is negotiable when times get tough.
Industry veterans still talk wistfully about vehicles that didn’t survive post-Great Recession planning when automakers focused on bread and butter models. Nobody will ever know how many roadsters, luxury sedans, even low-slung sporty pickups were erased from corporate drawing boards as automakers clung to life 2008-11.
Do we face another lost generation of cars as companies scale back their aspirations?
Probably not, according to industry experts.
What about the Bronco, F-150, Escalade?
Vehicles like the 2021 Chevrolet Tahoe, GMC Yukon, Cadillac Escalade, Honda Civic, Ford Bronco and new F-150 are “beyond the point of return,” Society of Automotive Engineers editorial director Bill Visnic said. They’re expected to be on sale in the next 10 months, and they’re all major moneymakers.
“It makes zero sense to do anything but launch them with whatever delay the current COVID-19 plant stoppages imposes,” Visnic said.
It appears likely most North American assembly plants will be closed for six to eight weeks, IHS Markit senior analyst Stephanie Brinley said. That may move the start of sales for vehicles from, say August to October, but not much more than that.
“It took GM about four weeks to get production back up to speed after the strike last fall,” Brinley said.
“It’ll depend on what vehicles each automaker needs most.”
Of 65 new or redesigned vehicles set to go on sale in 2020, all but the 13 already launched will face some delay, said Jeff Schuster, LMC Automotive president, Americas operations and global vehicle forecasts.
“The current environment is one of survival and cash preservation. Vehicle manufacturers will prioritize near-term launches on their ability to generate margin and cash. Safe to say pickup trucks and SUVs will continue to be the priority,” he said.
Automakers declined to comment on their launch schedules.
2020 new or redesigned vehicle delays
- 13 already launched
- 15 sales launches delayed within 2020
- 11 not officially delayed yet, but at high risk of delay from 3Q to 4Q
- 22 4Q launches that could shift in 2021
- 4 already delayed from 202 to 2021
Source: LMC Automotive
EV cancellations unlikely
“Anything beyond mid-2021 is definitely up for grabs,” said Sam Abuelsamid, principal analyst at Guidehouse Insights. “For the highest volume, highest profit programs, I expect manufacturers to try and stay on track as much as possible like the new big Jeeps” including the Grand Cherokee, Wagoneer and Grand Wagoneer.
Styling tweaks and minor feature updates to existing models – often called facelifts or mid cycle refreshes in the industry – are another matter. Typically done about four years into a model’s six-year life, they include new lights, grilles and special editions to gin up interest as a vehicle gets long in tooth.
Some of those – reportedly including the Chevrolet Traverse SUV and full-size Chevy and GMC pickups – have already been delayed to postpone paying suppliers for new parts for a few months or a year. More likely will be.
“There’s less money coming in, which at the end of the day means less money going out,” Brinley said.
Unlike the financial crisis that precipitated the Great Recession, and the accompanying spike in fuel prices that scared the devil out of buyers, there’s little sign the current situation will change what kind of vehicles people want. Nobody’s forecasting a flight back to sedans or rejection of electric vehicles.
“There’s no indication this will change the underlying trends in types of vehicles people want,” Brinley said.
To the relief of anybody who worries about carbon dioxide emissions, that means little likelihood of wholesale electric-vehicle program cancellations. The technology, and global if not U.S. demand, have evolved too far to turn back.
That doesn’t eliminate some delays, though. Vehicles like the Mach-E due for sale this year won’t slip much, but those farther out could.
That includes the 11 electric vehicles GM recently showed journalists. Most were due to go on sale in 2023-25, far enough out for a year to creep into the timeline, if money’s tight at GM.
There’s less confidence about autonomous vehicles. Will social distancing make people less willing to hire a robo-taxi if they don’t know who used it last?
Abuelsamid doesn’t expect autonomous vehicles to reach a million sales a year until 2027, with delivery vehicles leading the way.
Follow Detroit Free Press reporter Mark Phelan on Twitter: @mark_phelan.
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