- IHS Markit said Tuesday that it expects global vehicle sales to decline 22% this year to 70.3 million.
- The U.S. is projected to lead the global decline with a 26.6% fall in domestic vehicle sales.
- U.S. sales would be the lowest volume of sales since 2010 as the industry emerged from the Great Recession.
IHS Markit lowered its global auto sales forecast on Tuesday, saying it expects worldwide vehicle sales to decline 22% this year to 70.3 million units, led by a 26.6% fall in the U.S. to 12.5 million units, compared with a year ago.
Domestic sales would be the lowest since the 11.6 million cars and trucks sold in 2010 as the industry emerged from the Great Recession. It's also a steeper drop than IHS Markit's forecast in March of a 12% decline in global sales for 2020.
"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," said Colin Couchman, executive director, global autos demand forecasting at IHS Markit. "Market fortunes are expected to be mixed, as delayed and destroyed demand interacts with massive global supply disruption."
In the U.S., many dealership showrooms are shuttered, however the retailers can sell vehicles online. While better than being forced to completely close, which some states initially did, the digital sales aren't expected to supplement the drop in showroom traffic.
IHS forecasts China, the world's largest auto market, is expected to decline by more than 15.5% to 21 million units this year, with concerns on secondary impacts from the global contagion, which could further disrupt the recovery.
The decline in China is despite most factories being back to work after a countrywide lockdown to curb the spread of Covid-19, which is believed to have originated in the country's Hubei province late last year.
Across Western and Central Europe, IHS forecasts a 24.9% drop in sales, to 13.6 million units for the year. European markets, the firm says, "will experience mixed recovery cycles, based on local restrictions and guidance, together with varied economic support and stimulus provision."
Covid-19 lockdowns remain in place across Europe, especially in Italy, Spain, France, and the U.K. with dealerships shuttered, according to IHS.
As sales topple, so will vehicle production. The firm expects global light-duty vehicle production to drop 21.2% due to Covid-19 – an 18.8 million unit decline over 2019.
IHS' sales forecast is in line with others, including J.D. Power, which expects U.S. auto sales this year of between 12.5 million and 14.5 million vehicles, down from an estimated 16.5 million to 17 million vehicles before the pandemic.