How is automotive sector activity recovering from Covid-19?

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he automotive sector is now one of the best performers in the world economy, with sectoral activity above pre-pandemic levels in the first quarter of 2021, according to GlobalData.

In the first quarter of 2021, activity levels in the sector were 23.8% higher than at the end of 2019, before the pandemic decimated economies across the world. This means that of the 18 sectors included in the analysis, automotive ranks third in terms of its latest value for Covid-19 activity recovery.

Automotive stocks generally overperformed the market in the past year. By 16 March 2021, stocks in these companies – as tracked by GlobalData – were 94.2% above their starting point in October 2019. Across all sectors, the average was 33% higher.

Hiring levels are also useful in determining how confident a company is about the months ahead. GlobalData’s jobs index tracks job openings across thousands of companies on a daily basis, allowing users to assess confidence in real time and gauge which sectors are feeling Covid-19’s impact the hardest.

The number of open job advertisements in automotive is currently at a higher level than in most other industries, relative to their pre-pandemic norms. By 15 March 2021, the latest date for which data is available, hiring levels were 11.6% higher than prior to Covid-19’s impact. This means automotive raneds eighth out of the 18 sectors analysed in terms of recovery of hiring levels.

In addition to jobs and stocks, GlobalData’s composite index also factors deals into account, tracking mergers, acquisitions, private equity and venture capital deals on a daily basis. This, again, can be seen as a good indicator of how ambitious companies are feeling, with a greater number of deals indicating a more optimistic outlook.