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How is COVID-19 Affecting Transportation Attitudes?

Consumer preference shifting away from ride-hailing and public services
#Volkswagen #covid-19


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social distancing

                                    Getty Images

It will take at least several months to sort out what lasting effects the coronavirus will have on the auto industry. For now, the impact is devastating with global sales and production ground to a halt.

But several recent consumer studies suggest that car sales could rebound once the pandemic is contained. The upswing will be partially fueled by changes in consumer preferences toward personal vehicle use instead of ride-hailing or public transportation as a way to lessen close contact with strangers.

China’s Shift to Private Transportation

As the spread of the coronavirus began to slow in China in late February, a survey by market research firm Ipsos found that two in three respondents there indicated they preferred owning their own vehicle over public transportation.

That was twice the rate who selected the option before the outbreak, when private cars ranked behind public transportation and bikes/scooters.

consumer use of private and public transport

                                                                                                    Source: Ipsos

Among people who currently don’t own a vehicle, two-thirds said they wanted to buy a car within six months. The top reason: health concerns about taking public transportation.

Volkswagen believes this could be an opportunity for its entry-level Jetta brand, which was launched last year in China. The carmaker notes that 80% of first-time buyers in China opt for an entry-level model.

Ride-Hailing Declines

More recent studies conducted in other regions came to similar conclusions.

A Cars.com survey conducted in mid-March found that Americans are increasingly turning to private vehicles over ride-hailing services in the wake of the coronavirus outbreak and some 20% indicated they were interested in buying a car as a result of the pandemic. The bulk of prospective buyers listed concerns about their health in using public transportation and/or the cleanliness of a ride-sharing vehicle.

In Canada, the use of ride-hailing services and public transportation had plunged by 65% and 80%, respectively, in late March, according to an Autotrader survey. Of these, 70% said they didn’t intend to resume using ride-hailing services, while 40% indicated they were done with public transportation.

A separate Autotrader survey in the U.K. suggests demand for cars has remained strong during the pandemic’s outbreak. Some 58% of people queried on the car-shopping website said they were still in the market to buy a new or used car. More than 1 million people visit the U.K. version of the site per day, with the average number of saved vehicles per search increasing 8% last week over the same period in 2019.

At least a short-term uptick in consumer preference for personal ownership over shared mobility services also is expected in India, according to a report by the Financial Express. Social distancing concerns likely will remain for several quarters in the region, IHS Markit analysts tell the newspaper.