Worldwide light-vehicle sales are forecast to tumble 22 percent this year as the novel coronavirus (COVID-19) hits the global economy and depresses demand, IHS Markit said today.
The analysis and forecasting company projected global vehicle deliveries to total 70.3 million in 2020. IHS issued similar declines across all major regions.
“The unexpected and sudden nature of the impacts of the pandemic are hitting the autos sector hard, with unprecedented levels of uncertainty around prospects for meaningful global recovery,” Colin Couchman, executive director, global autos demand forecasting at IHS Markit, said in a statement.
“Market fortunes are expected to be mixed, as delayed and destroyed demand interacts with massive global supply disruption,” he said.
IHS Markit said it expects the global economy to contract about 3 percent “with a very sharp reduction in near-term demand/supply followed by a slow recovery.”
The company forecast that U.S. light-vehicle sales will slide 27 percent this year from 2019 levels to 12.5 million. IHS Markit said will be “historically low” in April and May. In recent decades, the lowest monthly selling rate was 8.8 million in December 1981, IHS Markit said.
In the U.S., states have issued stay-at-home orders intended to slow the spread of COVID-19. Major automakers, including General Motors Co. and Ford Motor Co., have closed North American factories.
COVID-19 originated in China. Factories in that country have restarted but IHS Markit new work practices to ensure safety amid the coronavirus “make it virtually impossible to rebound to previous operational capacity.” The forecasting company said it expects Mainland China deliveries to fall 15.5 percent this year to 21 million.
In western and central Europe, IHS Markit is forecasting vehicle sales to plunge almost 25 percent to 13.6 million. The region will see “mixed recovery cycles, based on local restrictions and guidance, together with varied economic support and stimulus provision,” according to the company.
IHS said worldwide light-vehicle production will drop 21 percent this year from 2019 because of COVID-19. The worst period, the forecasting company said, will be the second quarter when output is expected to be down 44 percent.