Covid 19 - From Mobility to Immobility Costs

We have to limit our movements to slow down the spread of the coronavirus. It is the best way to protect us and to reduce the number of people that are being seriously affected. It is also the way to alleviate the influx in hospitals, which should give scientists time to find a cure.

- Pascal Serres

This creates a strange atmosphere where we feel closer to each other, sharing anxiety, pains and hopes but at the same time we cannot be together. Our freedom is severely limited but the world is moving towards common priorities and people show a growing solidarity while most production of goods will cease. PSA, Renault and Volkswagen have announced factory lines closure in Europe. All manufacturers and supply chains will follow. New and used car sales are put on hold for a while.

Most companies in the mobility business are seriously affected and must adjust their activities. They have to organise teleworking as much as possible and close offices:

Airlines, trains, hotels and car rental companies are offering to move or cancel bookings at no cost while they are heavily reducing their activities. They are also implementing new cleaning procedures to avoid contamination by customers. Existing fleets will mostly be frozen (this concerns lessors and car rental businesses) as car production will cease. They will be unable to deliver new cars and customers will not terminate existing contracts for some time. Service will be limited (call-centres should be closed). Carsharing solutions will suffer during this time. Meantime, food and drug distribution must be open to avoid a shortage of basic goods. Therefore, a minimum of mobility solutions is required. Deliveries and online purchasing are a good alternative solution that will benefit.

At present cost concerns are not on the table: the only objective is to win the war against the virus. However, loss of revenue could be critical for some companies in the mobility sector. Governments are implementing policies to ease companies’ treasury and to avoid redundancies as we prepare for the recovery. Therefore the EU objective to maintain public deficits below 3% will certainly be pushed aside for the virus.

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