Car sales forecast slashed as coronavirus impact deepens, says Moody’s

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.