Act short term, think long term
The automotive sector has been hit harder than most in the pandemic. In recent research, almost one in five businesses in our industry said they had low or no confidence that they will survive the next three months. And automotive apprenticeship starts have seen a steep fall, down 63% in the first quarter of the new education year, between August and October 2020 vs the same period in 2019/20.
The lack of any real tangible support to improve apprenticeship take-up in today’s Budget was really disappointing, and the IMI will continue to ask Government to rethink its stance on the Apprenticeship Levy clawback.
There’s no hiding from it, this is a tough situation. But I remain optimistic and I want to explain why.
- First, because fortunes can rise as quickly as they fall. Dealers, for example, used to work to annual targets; these days they don’t look more than six months out. A lot can change in a short period.
- Next, I believe that all the talk about ‘pent-up demand’ in the economy will have an impact. Sure, this month (March 2021) isn’t going to be great but, with so many vehicles on fixed-term lease contracts, a lot of people will soon be looking to replace vehicles and there are a whole new group of savers who will have funds ready to spend.
- And then there’s electrification. Sales of EV vehicles were up 67% in 2020, and there are signs – we’ll be sharing more data on this soon – that EV skills are carrying a premium in the job market.
Right now things are rough, I get that, and my team at the IMI are doing everything they can to support you through this. The key thing is to do what’s required in the short term – control costs, delight customers, focus on cashflow – while not losing sight of the longer term.
In the longer term, our sector will be transformed: the vehicles we use, how we use them, how we sell them, and how they’re maintained. These changes will drive up values and rewards, but they do require people to keep learning and upskill themselves.
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Stay safe, stay strong.