Woman drives to essential services in the auto industry

Essential Services and the Australian Auto Industry

 

In Australia, our social distancing measures and lockdown of non-essential services have had a positive impact on the rate of COVID-19 infections. So much so the government recently announced its three-stage plan to relax coronavirus restrictions. Great news!

 

However, experts say we still have a long way to go before things return to normal. And the situation can easily change again – meaning what’s defined as ‘essential’ one day can be scratched from that list the next.

 

It’s unsurprising that, as we navigate the COVID-19 pandemic, many people are wondering what are classed as essential services in the auto industry. Here’s an overview as of late May.

 

What’s an Essential Service?

When the government called on the shutdown of non-essential activity it listed a few of the most obvious things (supermarkets, banks, pharmacies and service stations for example) but never gave an exhaustive list.

 

Prime Minister Scott Morrison said shopping should be limited to what you need, such as food and other essential supplies. Naturally, for those services to continue to meet public demand, freight, logistics and home delivery services need to remain in operation.

 

Plus, services that support safe access to private transport need to continue for front-line workers.

 

To a certain extent, we’ve been self-governing when it comes to making decisions on what’s essential in our lives. And the evidence shows we’re doing a good job at it.

 

But what effect has it had on the auto industry?

 

Impacts on Australia’s auto industry from coronavirus

In anticipation of detrimental impacts to the industry, in March the Motor Trades Association of Australia (MTAA) and the Australian Automotive Aftermarket Association (AAAA) began lobbying for the ‘Automotive Supply Chain’ to continue to be recognised as essential services.

 

Among a larger list of logistical services, this includes:

  • Automotive repair and maintenance facilities (servicing and supply of parts for private and commercial vehicles)
  • Postal and shipping workers, including private companies and those that move cargo or passengers
  • Dealerships selling new and used cars

 

The CEO of AAAA, Stuart Charity said, “We want to make sure that we can keep cars and trucks on the road in this time of crisis, particularly for those who are supporting others or accessing medical care or medication. With some supermarkets restricting delivery services, for many people being able to access a local supermarket requires a car.”

 

The Federal Chamber of Automotive Industries (FCAI) chief executive, Tony Weber agreed, saying, “With the increasing focus on social distancing, safe and reliable private transport is essential to enable communities and businesses to continue to operate.”

 

In fact, the Australian Automotive Dealers Association (AADA) is recommending that now might be the perfect time to book in that overdue service.

 

Impacts on Australia’s car insurance industry from coronavirus

We can’t speak for others in our industry, however at PD Insurance we’ve seen little impact to date.

 

The two noticeable changes we have experienced are:

  1. Claims falling slightly due to fewer drivers on the road (and therefore fewer accidents)
  2. An increase in roadside assistance due to people driving their cars infrequently (leading to flat battery, etc)

 

With the slow easing of travel and other public health order restrictions, we expect this to remain so as things slowly return to ‘normal’.

 

Having said this, many people are still driving their car on a regular basis. And even those practicing the strictest of social distancing measures are still likely need to drive from time to time (groceries, work, medical appointments, etc).

 

That’s why we continue to urge Australians to keep their car insurance and roadside assistance up to date. You never know when you’ll need to drive somewhere, and accidents happen all the time.

 

But this isn’t the only rationale – here are all the reasons why you shouldn’t cancel your car insurance.

 

Over to You – Essential Auto Industry Services

What are your thoughts on the impact of COVID-19 on the auto industry? What ‘essential’ auto services have you used during the pandemic? Or have you decided to put things on hold until a particular point in the future? Tell us below or on our Facebook page.

 

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