AutoTechInsight
Rapid Response 2026: Updated forecast assumptions amidst the Iran war (Issue 5)
S&P Global Mobility’s fifth Rapid Response of 2026 discusses our latest forecast assumptions related to the Middle East conflict. At time of writing, the May 2026 light-vehicle production forecast is in development. On our typical schedule, there is no sales forecast for May, though we are providing a top-line interim forecast with the latest assumptions.
The figures here are subject to change. The final forecast adjustments may vary and are subject to normal monthly forecast adjustments which may not be directly related to the Iran war. The May 2026 LV Production Forecast settings will be final mid-month; while this is our latest thinking, the situation remains fluid and assumptions may change again prior the June 2026 sales and production forecast round.
The Strait of Hormuz has been largely closed for two months, March and April. The US and Iran seem to both position their control over the Strait (and keeping it closed) as a position of negotiating power, and traffic is not yet flowing. As the situation continues and progress toward a resolution seems to be moving erratically, the latest assumptions informing our May automotive forecast reflect expectations for severely constrained exports from Gulf countries during spring 2026, with slow relief into the summer of 2026. After that, the expectation is that oil flows will improve intermittently rather than resuming with steady progression.
With the strait still closed as of May 1, 2026, prior assumptions are revised. In this interim May sales forecast projection, we see global light-vehicle sales potentially dropping between 650,000 and 900,000 units in 2026, compared with our April 2026 forecast. We could see 2026 global light-vehicle sales falling from the 90.5 million units we forecast in the April round to between 89.9 and 89.6 million units. We have also revised the outlook for 2027, as the longer the situation deteriorates, the greater the expectation is that impact will fall into next year as well. The April 2026 light-vehicle forecast round saw 2027 global sales at 92.6 million units; we now project that could be between 91.6 and 91.3 million units.
