With the coronavirus outbreak hitting automotive demand and disrupting supply chains, Moody’s is lowering its sales forecast for global car manufacturers, according to a new report published Wednesday.
The rating agency’s outlook on the sector remains negative.
“Global vehicle sales will decline 2.5% in 2020, narrowing from a 4.6% drop in 2019, but worsening from the 0.9% decline that we had previously projected for this year. Sales will rebound only modestly in 2021, with growth of 1.5%,” said Falk Frey, a Moody’s Senior Vice President.
Chinese auto sales will fall 2.9% in 2020, a meaningfully weaker performance than the 1% growth Moody’s had previously projected.
US sales will remain weak, while western European car sales will decline in 2020 after stronger-than-expected demand at the end of 2019.
Japan will be the only major auto market to see unit sales growth, with light vehicle sales expected to grow 0.4% in 2020. This follows a steeper-than-expected decline of 1.4% in 2019 because of an increase in the country’s consumption tax and the production disruptions caused by three major typhoons.