Car sales will not recover to pre-crisis levels until the middle of this decade, according to credit ratings giant Moody’s.
In a new report it said the 27 per cent drop in worldwide car sales in the first half of this year had ‘bottomed out’ and it expected a sharp rise in 2021.
But it said the severity of the fall would mean that the pace of recovery towards peaks seen before the pandemic – when 95million vehicles a year were sold globally – would be only moderate after that.
‘The rise in shipments will slow in 2023 and the recovery length, with 2018-19 sales levels unlikely to be recaptured until about 2025,’ it said.
‘Governments’ efforts to support the industry have so far been limited, and we do not expect that to change substantially.
‘This is a sharp contrast to numerous programmes to support or bail out automakers during the 2008-9 crisis.’
While car sales peaked at 95million in 2017, by 2019 they had already slipped to 90million. Moody’s said: ‘The auto industry was already beginning a cyclical downturn before the onset of the coronavirus-induced recession, and companies had started preparing for weaker demand.
‘But, as the pandemic spread, factories and dealerships closed and sales collapsed more quickly than carmakers could have prepared for – falling by about 40 per cent during the second quarter.