Source: https://www.theamericanreporter.com/why-are-the-cars-in-demand-even-when-there-was-a-halt-in-production/
When car production stops, people are eager to buy new vehicles. This phenomenon is not limited to a single industry or type of vehicle.
One reason is the psychological factor. People often associate owning a car with freedom and independence. When they can't own one, they may feel anxious about being unable to drive themselves or others.
As production stops, the demand for new vehicles increases. However, this surge in demand is often offset by a decrease in sales of used vehicles. This creates a perfect storm that drives up prices.
A 2020 report from the National Automobile Dealers Association (NADA) found that the average price of a new vehicle increased by over 10% due to supply chain disruptions and global events.
When production stops, economies are forced to adjust. This can lead to a decline in consumer spending and business investment. In turn, this can have a ripple effect throughout the entire supply chain.
A 2020 report from the International Monetary Fund (IMF) found that global economic growth slowed down during the pandemic due to increased production halts and supply chain disruptions.