The latest light vehicle production forecast out this week from S&P Global Mobility is grim showing declines in every region as original March forecasts that assumed a short Trump Iranian war thought it was a temporary blip. As we said at the time “Well, yes but there is no indication that this will be a short term event or that it’s economic consequences were considered by the whimsical U.S. president who would be king. Moreover the former Detroit Three are heavily dependent on sales of gas-gulping light trucks as fuel prices are climbing with no end in sight. Additionally, the Administration is going it alone in this war, as former allies, who were not informed or consulted, refuse to be drawn into the tragic and increasingly bloody conflict – AutoCrat.”* This brings us to:

“The global auto industry’s near-term outlook is heavily influenced by the ongoing conflict in Iran, with the Strait of Hormuz now expected to remain closed through April, leading to higher oil prices and increased volatility. These conditions are raising manufacturing and logistics costs, putting pressure on vehicle demand and production,” said Mike Wall, Executive Director, Automotive Analysis, S&P Global Mobility yesterday.

“April’s forecast update includes downward revisions across most regions, especially Middle East/Iran and China, as the industry adjusts to persistent geopolitical and macroeconomic challenges. Elevated energy costs, inflation, and supply chain instability are the main factors affecting the industry,” said Wall. “Alternative scenarios, including a severe oil shock, are still being considered due to the risk of extended disruption.”