The closure of auto plants in the U.S. may reduce sales of new cars by 0.9 – 1.5 million units
Related Covid-19 visiting automotive plants in North America can cost American automakers of not less than 900 000 car sales this year, which greatly reduce the demand for steel.
six-week shutdown of the us automakers, many of which have been unavailable since mid-March, will reduce the estimate of car sales in the United States in 2020 to 15.6 million units, compared with 16.5 million units before the pandemic coronavirus, said a senior analyst at the Center for Automotive Research (CAR) Bernard Swiecki, in a conference call organized by the site Steel Market.
This means that in the best case, when automakers will begin production in the United States in the next two weeks, the automotive consumption of steel will be reduced compared to previous estimates of approximately 921 000 tons, and the use of aluminium will be reduced by approximately 205 000 tonnes. The average American car in 2018 had 2 047 pounds of steel and 455 pounds of aluminum, according to the American iron and steel Institute (AISI).
stay longer will lead to deeper reductions in demand: a 12-week shutdown in the industry will reduce sales of 1.4 million vehicles, and a six-month closure - at 3.4 million vehicles.
According to Swiecki when the automakers resume manufacturing, they are likely to focus on trucks and SUVs with high margins, those types of cars that consume more steel.
More serious problem for automakers is not planned to restart their plants in particular States, and the question of whether their domestic and international suppliers of spare parts to supply or still there are limitations associated with the coronavirus.
Initially, the largest U.S. automakers, Fiat-Chrysler Automobiles (FCA), Ford, and General Motors (GM) - were planning to close for two weeks starting March 19. These closures lasted until April, as the FCA announces that it plans to resume some operations on may 4, while Ford and GM continue to assess the situation.
In response to the stop of the auto industry, American steel companies, most of which were integrated into the supply chain, has suspended production over 10 million tons of steel capacity per year for the production of flat rolled products.