COVID-19 Impact on the Low Speed Vehicle in Automotive Industry

COVID-19 Impact on the Low Speed Vehicle in Automotive Industry

  • Automotive
  • Nov 19, 2020

COVID-19 Impact on the Low Speed Vehicle in Automotive Industry


The COVID-19 a pandemic disease has made all countries standstill for almost two quarters since November 2019, outbreak from China to all the countries worldwide. It affected the biological balance, world & country-wise economy, automotive sector, industrial sector and other owing to which lockdowns were imposed for controlling the widespread of the viral disease. To prevent the rapid spread of disease spread lockdown is yet the better solution observed in many countries but it has a negative impact on the economy. One of the most common safety precautions imposed by all the countries is the use of sanitizers, face masks to prevent viruses entering the body and lockdown all over the country apart from daily needs services such as food items, medicines and grocery.

Introduction of lockdown has resulted in temporarily closing of all operations for all sectors till unlock procedure is started by respective governments. COVID–19 pandemic has not only impacted health or medical concerns but also economical situations are facing consequences of this pandemic. These lockdown implementations resulted in heavy impact on every industry, majority of the businesses incurred losses. The pandemic situation dig a deep hole in customer’s financial incomes as companies are nearing recession, termination of employment, lay off and others problems are rising in the global market. The automotive industry experienced strong hit in the first couple of quarter of the 2020 as the all showrooms, supply chain, manufacturing facilities and other supporting offices, warehouse and transportation has been shut down.

Low speed vehicle market is facing collateral damage as that of other automotive industry. Simultaneously, Low speed vehicle technology and industry is facing serious decline in revenue generation. This restricted situation created major impact of the customer’s financial status as people are now focusing on completing the needs primarily rather than going for wants and desires such as buying a low speed electric car for personal carriers. Car has almost become important part of the person’s life and automotive industry has witnessed steep decline in sale or zero sale at the end of the first quarter. Market leading players such as Toyota, Ford, Volkswagen, Polaris, Deere, Kubota, Textron and others are facing reduction in revenue compared to previous years.

For instance:

According to ET Auto, the India’s farm equipment manufacturer Escorts Ltd has delayed the startup of their new manufacturing plant with Japanese maker Kubota due to coronavirus outbreak. The nationwide lockdown has impacted the setup of manufacturing plant which has resulted in huge loss and the delay of the manufacturing till Q3 of 2021.

However, growth for low speed vehicle market is on hault mode, but not stopped; when automotive industry operates at normal level it is expected that Low Speed Vehicle will achieve higher growth rate than overall automotive industry.

Impact on Demand of Low Speed Vehicle:

Counted as future and advanced technology for automobiles; as it pollution free, emission free and ensures smooth running of a vehicle, low speed vehicle are being rapidly adopted by manufacturers on their assembly lines for industrial use, at sports stadium such as Cricket, Football, Golf Court and for personal carriers. From the past few years low speed vehicle have seen exceptional growth in adoption rate owing to its precisely advanced features at not much additional cost than normal car. Feature such as low speed, emission free, pollution free and light weight and unmatched advance technicalities.

The manufacturing capacity of the industries manufacturing low speed vehicle has drastically declined due to employee unavailability as the employee has moved to their respective hometowns due to lockdown and loss of jobs. The demand has decreased as other businesses are affected due to lockdown due to COVID-19.

The low speed vehicles are used in golf courses and besides this, they are used in large educational campus, at airport, in industries for travelling from different job floor and for material handling purposes, in dockyards for consignment handling. As due to COVID-19 lockdown, these businesses have haulted and hence the demand for low speed vehicle has fallen steeply.

COVID–19 pandemics impacted negatively on demand for low speed vehicle; which has witnessed a serious drought in first and partially second quarter of the year 2020 during COVID-19 pandemic; which has depicted the consequences in sales reduction which is worst in history since its inventions. However, with loosening in rules and regulations of lockdowns and resumption of operations in all the sectors; demand for low speed vehicles is slowly gaining ace as manufacturing plants have started manufacturing the low speed vehicles on small scale with following social distancing norms instructed by government bodies.

Impact on Supply of Low Speed Vehicle:

The pandemic has resulted in the shutdown of the manufacturing units as well the supply chain is also affected adversely which has resulted in less supply than normal. When government has initiated unlock phase, the supply chain is started which minimum cost and certain limitations which results in significant delays and the logistics chain has been stretched extremely thin.

Below table statistics indicate that during fiscal year 19-20 in India; M&M sales has decreased due to decline in demand and impact of lockdown. In the month of May when government eased up restrictions on businesses countrywide, sales again picked up for vehicles and demand is increasing steeply. Same situation can be observed and anticipated worldwide as duration and timing for lockdowns is different due to non-uniform spread of coronavirus.

Steps Taken by Manufacturers during COVID-19 Situations:

During lockdown and restricted course of time, most of manufacturing sites remained closed due to government regulations; however, with limited operating staff and assurance of following social distancing norms manufacturing plants have got permissions to resume their operations with half strength of their employees. Manufacturers of low speed vehicles are manufacturing vehicles as per need and order confirmation from the customer as they want to avoid losses occurred due to covid-19 pandemic and less demand from the market. Also; manufacturers are not opting for any undue risk of manufacturing more than demand and are cautious of further market situations as conditions are unpredictable and vulnerable.

Many manufacturers such as TVS has made an arrangement for their employees to stay at their factory site which will avoid travelling and will also help in spread of corona virus. These steps are taken by the manufacturers to avoid spread of virus and save their employees from getting affected.


From the overview, impact on demand and steps taken by manufacturers it can be inferred that initially low speed vehicle market witnessed steep decline as automotive demand and supply due to uncontrollable environmental factors; gradually demand is increasing for automobiles as governments have started opening various sectors in order to avoid recession like circumstances. The low speed vehicles demand in the commercial sector and in Industries will be increased gradually as the usage of low speed vehicle will be increased. The sports world such as Cricket, Football had resumed their games and this unlock effect will slowly increase the demand of the low speed vehicle.

All manufacturing units had started their assembly lines with proper sanitization and maintaining social distancing between the employees which will slowly increase supply of the low speed vehicles.


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