Hopes that 2021 would recover much of the auto sales lost to the pandemic in 2020 are fading as the semiconductor shortage continues to bring widespread factory stoppages.
Last month, IHS Markit, which many automakers use as their benchmark for production forecasting, said it was trimming its production forecast by 6.2 percent, or 5 million units, to 75.8 million for 2021.
"The outlook for Q4 now reflects heightened risk as challenges to the supply chain – primarily semiconductors – remain entrenched,” IHS analyst Mark Fulthorpe wrote.
In its most recent note to investors, IHS said that 9.5 to 11 million units could be lost globally over the full year. In contrast to earlier statements from automakers and analysts expecting a recovery in the second half of 2021, IHS said Monday that the disruption could continue into the first half of 2022.
"H2 2022 may be the point at which we look for the stabilization of supply, with recovery efforts now starting only from H1 2023,” the note said. "We are extending the window for potential disruption and delaying further the point at which we believe a meaningful recovery can begin.”
In North America, IHS said 1.2 million vehicles were lost in the first half. It also expects the industry to lose another 936,000 units in the third quarter along with 88,000 more in the fourth quarter. Most of those losses are being tied to cuts at General Motors, Ford and Volkswagen, IHS said.
In Europe, IHS estimates that some 1.1 million units were lost in the first half. Third-quarter loss estimates have been raised to 729,000 units from 666,000 units, primarily due to production halts at Stellantis and Volkswagen.
That figure does not include up to 50,000 "incomplete” vehicles produced at VW that are missing critical parts that need to be added before they can be sold, IHS said.
On the demand side, LMC Automotive said at the end of September that it was cutting its global light vehicle forecast by 6 million units, to 81 million vehicles. In June, LMC had forecast demand of 87 million vehicles for the year.
"The hope of a return to pre-pandemic conditions and a full recovery in early 2022 has all but evaporated,” the analyst said.
LMC also noted that future vehicle demand could suffer from current conditions, in which automakers have prioritized higher-margin models and emissions-compliant (and costly) EVs, leading to higher prices and a scarcity of lower-end vehicles on showroom floors.
"The lack of vehicle availability and the increase in pricing may have pushed a number of consumers in many countries out of the new vehicle market,” LMC said, "causing them to either hold on to an existing vehicle for longer, purchase a used vehicle, or buy out a lease, instead of purchasing/leasing a new vehicle.”
LMC now expects global light vehicle sales of 85 million units in 2022, a drop of 8 percent from its second quarter forecast, and 94 million units in 2023, a decline of 3 percent from the second quarter.