We know that industries far and wide are taking a hit from the global COVID-19 pandemic, but the automotive industry had some added pressures.
Closing out 2019, several car companies were anticipating the impacts of a slowdown in their sector for 2020, and many analysts predicted a 1% dip in a market that was coming off a string of healthy years.
Now a 1% dip doesn’t sound so bad, as IHS Markit says the coronavirus will likely cause the U.S. auto market to slump more than 15% this year. As for global sales, their prediction of a 12% decrease is worse than the 8% drop we saw during the Great Recession.
But again, it’s all a matter of perspective since the numbers in the near-term get even worse than that. According to JD Power, sales of vehicles in U.S. states which are under shelter-in-place orders will plummet 80%.
And according to Reuters, JD Power’s vice president of data and analytics Tyson Jominy says it could even be worse than that. He said the New York market, which is normally rather resilient, is expected to change dramatically as the state continues to be barraged with coronavirus cases.
From a production standpoint, IHS Markit says global production of vehicles is expected to drop by 1.4 million vehicles based on the plant shutdowns so far and their expected duration.