Akron, Ohio - Amid the chaos and uncertainty that the Covid-19 pandemic has brought with its shutdowns and slowdowns and economic shakeups, there is a bright light on the horizon.
Jeff Schuster, LMC Automotive's president of Americas operation and global vehicle forecasting, is confident that light is more than a glimmer of hope. He sees it as a sign that the auto industry's recovery is coming quickly.
"We took a pretty deep decline this year, but I think the good news is the market is exceeding, and continues to exceed, expectations," Schuster said during a keynote presentation that kicked off the final week of the International Tire Exhibition & Conference (ITEC), organised Rubber & Plastics News.
"There are still headwinds ahead of us, a lot of uncertainty ahead of us, but I think we are in a much better place than where we were expected to be if we just go back to the April-May time frame from where we are today."
One sure sign that the auto market is recovering, and doing so quickly, is the fact that production has only slightly outpaced demand.
"Everything that has been coming back into the dealers from the plants in May has essentially gone out," Schuster said.
He estimates that US vehicle sales will land somewhere in the 13.5 million to 13.9 million range this year, well below the 17 million unit mark the industry has hit each of the previous five years.
But the figure will likely steadily increase, topping the 15 million unit mark in 2021 and the 16 million unit mark in 2022.
By 2024, the US should see sales of close to 17 million again, Schuster anticipates.
Globally, automotive markets are showing varying degrees of a V-shaped recovery, according to Schuster, with both production and sales at their lowest levels in April for many regions.
Across three markets – the US, Western Europe and India – the seasonally adjusted annual rates (SAAR) for light vehicles plummeted to 8.73 million (US), 3.38 million (Western Europe) and zero (India) in April.
"This is the first time and hopefully the last time we have seen this happen," Schuster said. "India had zero vehicles in April: Zero vehicles sold, zero vehicles produced."
China's sales and production levels fell to their lowest points in February, with SAAR at 3.31 million.
By August, SAAR had rebounded to its highest point in both the US and Western Europe, coming in at 15.2 million and 16.9 million, respectively. India and China saw SAAR reach its highest recovery points in July, before dipping slightly in August to 2.52 million and 28 million, respectively.
Globally, Schuster said, all of the markets are rebounding as consumer confidence continues to grow and the vehicle inventory replenishes, albeit more slowly than demand.