IHS Updates Global Light Vehicle Sales Forecast
April 21, 2020Comments
Recent analysis from IHS Markit predicts global light-vehicle sales to dip by 22 percent, to 70.3 million units, in 2020, in the wake of COVID-19. Though most factories in China are back to work, IHS Markit forecasters caution that it will take time for plants to fully recover, especially as revised COVID-19 working practices make it virtually impossible to rebound to previous operational capacity, among weakened demand conditions. IHS Markit forecasts mainland China to experience a sales decline of more than 15.5 percent year over year, to 21 million units. In addition, it predicts the U.S. light-vehicle market to decline 26.6 percent from 2019 levels, to 12.5 million units this year. Across western and central Europe, IHS Markit forecasts a 24.9 percent drop in light-vehicle sales, to 13.6 million units for the year. European markets will experience mixed recovery cycles, based on local restrictions and guidance, together with varied economic support and stimulus provision.
Much of China has now returned to work and more than half of vehicle-manufacturing facilities were reported to be at full capacity at the end of March. However, the pace of production has been adjusted to align with inventory and demand levels. April forecasts reflect extended downtime, staggered resumption patterns and ongoing supply chain description across the region.
Across Europe, the return to work is varied, with some auto manufacturers preparing for a gradual return to production beginning this week, and some already underway--although component supply remains critical to restart operations. In some countries—such as France and the UK--government advice currently prevents any meaningful activity until the beginning of May at the earliest.
In North America, IHS Markit forecasts reflect shutdowns in production from mid-March through early May, at a minimum. In those nine weeks, an estimated 2.75 million units will have been lost, with risk of further extensions on the horizon as the virus continues to affect various regions around the country.
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