Assessing the Impact of COVID-19 on Various Industries

As COVID-19 continues to spread rapidly around the world, its severe impact can be observed as it has crippled the entire global economy and has pushed it into recession. Demand and supply shock can be felt by all the major industries, including Aerospace, Automotive, Electrical & Electronics, Construction, Energy, Chemical, and many others.

Lucintel has tried to access and ascertain the potential impact of COVID-19 on major industries through this analysis. Lucintel hopes it will help the management and other stake holders to draw strategies to survive in this uncertain time and navigate their organizations through this crisis.

Analysis suggests, an estimated >$2.5 Trillion loss in the global GDP. More than 300 Million people lost jobs globally. Lucintel estimates 5% - 30% drop in revenue for most industries globally in 2020. Impact is expected to be more severe and worse than the 2009 recession. Economy, industries and leaders across companies are facing unprecedented challenges, such as uncertainty over recovery, liquidity crunch, low demand, supply chain issues, and worker safety.

Most of the industries tracked in this study have been hit extremely hard by the COVID-19 crisis - even harder in some cases than the 2008-2009 financial crises, such as automotive, aerospace, and construction. The impact is severe and there are still a lot of uncertainties about when the market will recover. The below figure 1 compare impact of COVID-19 pandemic on various industries.

Increasing rate of unemployment, declining consumer confidence, countries under lockdown, and factories under shutdown have pushed companies to take tough decisions for surviving this crisis and this has come in the form of production cut, salary reduction/ deferred salary payments, lay-offs, furloughs, and divestments, to stay afloat and fund critical functioning.

Governments worldwide have ordered businesses to close temporarily and billions of people are to stay at home in an effort to fight COVID-19. A lockdown may seem like a good plan to contain the spread of this disease but for many in developing countries; it is simply not an option. Governments around the world are rolling out financial relief measures and programs to support the economy impacted by this COVID-19 pandemic.

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