“This domestic weakness in China is partly offset by a stronger export push, as Chinese OEMs redirect volumes to other markets with well-priced, feature-rich products. Elsewhere, most forecast moves are modest, but pressure is building in ASEAN and Middle East/Africa while Europe and North America show more resilience. Overall revisions reflect affordability, energy-cost sensitivity, and accelerating localization/export strategies,” said Mike Wall, Executive Director, Automotive Analysis, S&P Global Mobility.

North America’s production outlook is revised up for both 2026 and 2027, rising by 49,000 and 54,000 units. “Resilience is the key theme, supported by stronger demand and incoming production results, less by forward demand acceleration. Automakers are still expected to build near existing rates, but supply chain/logistics issues and escalating costs remain risks. With US-Iran tensions effectively a stalemate, inflationary pressure could weigh on demand, so production is expected to slow from Q4 2026 through at least Q2 2027 to protect inventories and profitability,” said Wall.