Morocco’s Auto Industry Hit Hard: 40% Revenue Drop Amid COVID-19 Crisis

The Moroccan automotive sector, like that of European and Asian countries, has suffered a severe recession in the first half of 2020 due to the Covid-19 pandemic, according to a report by the Policy Center entitled "The national automotive industry facing Covid-19: should we be concerned about the impact on the current account?". The report shows signs of concern. During the first three months of the year, automotive exports fell by nearly a quarter compared to the same period in 2019, even before the state of emergency and lockdown were declared in the kingdom.

The report talks about a decline of 13.9 billion dirhams over the first 5 months of the year due to the widespread lockdown in many countries. This caused the collapse of global demand and a slowdown in production. The decline particularly affected finished products, especially those from assembly (36%), semi-products (26%) for wiring and 13% for "vehicle interior and seat" products.

The worst is to be feared: the report points out that the exports of the national automotive sector could suffer a loss of 33 billion dirhams if this downward trend continues until the end of the year, the equivalent of 3% of GDP. Hence the need to measure the sector’s contribution to foreign exchange earnings and to favor national capital.