Future Past, Present

Manufacturing companies will have to take steps to recover after this challenging period and be ready to take a leap when situation starts returning to normal.

Nobody would have thought two months back that the whole world would come to a standstill. Corona virus has impacted global health, international travel, global supply chain and above all the global economy. It is forecasted, that there will be about half a percent decline of growth on the global economy due to the Corona virus. The forecast of the growth of GDP globally was 2.8% and under the present circumstances it is expected to dip to 2.3%, but the larger impact will be on India as it forecasted a GDP impact of Covid -19 will be to the extent of -1.1%.              

The impact of Covid-19 is not going to be uniform across industries. Further this can lead to adoption of new technology and would give impetus to sectors like healthcare, infrastructure, information technology, pharma, e-commerce, medical equipment, agriculture, food processing and packaging amongst others. As per estimate, extension of the nationwide lockdown till May 3 will inflict an economic loss of USD 234.4 billion, and result in stagnant GDP for calendar year 2020.   

In the manufacturing industry, production has stopped and millions of workers have been sent home. The corona epidemic is another damper, especially for the construction and mining equipment manufacturers. Because of the weakening economy, OHV manufacturers have been struggling with falling sales in all vehicle segments for almost two years. While the large Indian and German OEMs are likely to survive the crisis organizationally and financially, many Tier 1 and Tier 2 suppliers are concerned with bare survival.        

The virus has shut down production and disabled critical components of supply chain as a result of which production halts - which will lead to layoffs occurring and in turn would lead us to a vicious cycle. In fact global trade is predicted to see a huge fall ranging from 20% to 35% as per current projections of OECD. Covid impact has resulted in tighter credits and cash flow constraints. It is a question for survival for many. Manufacturing companies will have to take steps to recover after this challenging period and be ready to take a leap when situation starts returning to normal.            

The following pages throw light on the impact of the pandemic on some of the industry verticals, and clear-cut suggestion from experts from respective industries.

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