AutoTechInsight
Rapid Response 2026: Updated forecast assumptions amidst the Iran war
S&P Global Mobility’s fourth Rapid Response of 2026 discusses our latest forecast assumptions -- and the potential for an oil price shock situation before the end of 2026. At time of writing, the April 2026 light-vehicle sales and production forecasts are in development. The figures here reflect our early draft thinking and are subject to some change. The light-vehicle sales and production forecasts will be available to clients in mid-April; the next forecast round for the medium and heavy duty forecasts will be completed in May.
As with our previous report, there are factors that could change our assessment, and we are not providing a probability as to whether the oil price shock scenario will or will not come to pass. If the conflict turns into a ground war, the outlook could change. The same is true if other countries get involved and to what degree. This assessment does not address broader potentials for ground war or further involvements.
The global market will begin to feel deeper impact as well if the Strait of Hormuz remains closed through the month of April. Our March 2026 TIV base case assumptions were optimistic that tanker traffic would begin to flow after a couple of weeks and be restored by late March or early April. This has not happened. The base case assumptions behind our April 2026 TIV forecast now assume that the strait will remain essentially closed through April. Reopening the Strait is expected to be a gradual process and normal shipping in the region would not resume until the second half of 2026. Presuming the strait is reopened, confidence in the oil flows will rebuild as the situation stabilizes. Among the remaining uncertainties is that energy assets have been damaged during the war, but extent of damage and cost and time needed for repair is unknown.
The S&P Global Mobility light-vehicle April 2026 draft global sales forecast is seeing global light-vehicle sales expectations reduced by 800,000 to 900,000 units and 500,000 units circa 2027; the 200,000-unit reduction in GCC sales is included in that figure. The impact on countries across the world is also likely to be uneven as well -- we are not providing regional forecast yet. Initially, we see the current vehicle inventory state strong enough to absorb the impact of potential production cuts -- the sales reduction is forecast based on the economic impact rather than lower production. The April 2026 draft reduction is in addition to a 500,000-unit impact the March 2026 global sales forecast reflected. It is also important to note that the figures reflect other macro-economic impacts, further affordability pressure with the higher oil prices, and the direct impact to vehicle sales in the Middle East. Included in the April 2026 affordability impact assumptions is the expectation that higher energy inflation will result in central banks delaying interest cuts (versus raising rates).
