Macroeconomic Consequences Caused by the COVID-19 Pandemic – Case Study of the Automotive Industry
Macroeconomic Consequences Caused by the COVID-19 Pandemic – Case Study of the Automotive Industry

Author(s): Nikola Radic, Vlado Radic
Subject(s): Social Sciences, Economy
Published by: Udruženje ekonomista i menadžera Balkana
Summary/Abstract: As a synonym for the industrial development of the 20th century, the automobile industry is considered the “industry of all industries” and the backbone of the development of mass production. It is one of the pillars of the global economy and a signifcant driver of macroeconomic growth, stability and technological development. The core of the industry (production of cars, parts, assemblies and components) interacts with a wide range of business actors in the value chain, which multiplies the positive impact on economic growth and development. The economic importance of the automotive industry far exceeds its quantitative dimensions. The automotive industry has signifcantly contributed to the introduction of the concept of integrated supply chains and modular procurement, so all changes in the automotive industry have a specifc “echo” in the entire economy. The Covid-19 pandemic caused major problems in the functioning of supply chains, which had unprecedented consequences for the automotive industry. Currently, the biggest problem is the months-long shortage of semiconductors, caused by the reorientation of manufacturers to semiconductors for mobile phones, video game consoles and laptops. The paper analyzes the decline in car production and sales, lower-income, layoffs and problems with car delivery.

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