April 2026 light vehicle production forecast

Europe

Europe’s light vehicle production outlook was reduced by 114,000 units for 2026 and 143,000 units for 2027. The forecast reflects additional pressure from the Iran conflict, rising energy costs, and supply chain disruptions, along with ongoing affordability challenges. Demand estimates have been downgraded across key domestic and export markets.

Greater China

Greater China’s light vehicle production outlook was reduced by 239,000 units for 2026 and 156,000 units for 2027. While there was a post-holiday demand recovery in monthly terms, year-on-year performance remains weak due to low consumer confidence and the Iran conflict. Exports remain a growth driver, but structural headwinds like destocking, component pricing and availability, overseas localization, and regulatory tightening led to further downward revisions.

Japan/ Korea

The production outlook for Japan was reduced by 60,000 units for 2026 and 26,000 units for 2027, with a long-term reduction of around 94,000 units per year due to sourcing changes. The prolonged Middle East conflict is expected to impact both domestic and export demand through inflation and market instability. South Korea exceeded expectations in March by about 40,000 units, but production forecasts were trimmed by 5,000 units for 2026 and 16,000 units for 2027 due to anticipated weaker demand from higher crude oil prices and ongoing instability.

Middle East/ Africa

The production outlook for the Middle East and Africa was reduced by 143,000 units for 2026 and 126,000 units for 2027 but increased by 36,000 units for 2028. The downgrades are mainly due to the Iran conflict, which has disrupted demand, production, logistics, and supply chains, with effects spreading to neighboring Gulf countries. The increase in 2028 is supported by new Chinese automaker production in Egypt and higher light commercial vehicle output in Algeria.

North America

North America’s vehicle production outlook was reduced by 63,000 units for 2026 and 235,000 units for 2027. Near-term builds are still needed to meet demand and rebuild lean inventories, but operational constraints and program transitions, such as General Motors’ full-size pickup retooling and Ford’s F-Series production recovery efforts, remain critical factors. Automakers are expected to maintain output until demand weakening is clear, so a larger downgrade is expected in late 2026 through the first half of 2027.

South America

South America’s production outlook was reduced by 40,000 units for 2026, increased by 5,000 units for 2027, and reduced by 52,000 units for 2028. The near-term downgrade reflects a more cautious stance due to Iran conflict risks, despite strong March results in Brazil driven by discounting, which is not expected to be sustainable. Later-year volumes were also revised down, and Colombia was cut by around 10,000 units per year due to the end of Renault Duster production in 2026 with no immediate successor.

South Asia

South Asia’s production outlook was reduced by 88,000 units for 2026 and 74,000 units for 2027. ASEAN production fell sharply in March, declining 8.5 percent year-on-year to 293,000 units, erasing earlier gains and reflecting the impact of energy-driven inflation and supply chain risks from the Iran conflict. India, highly dependent on Gulf energy imports, saw its forecast reduced by 22,000 units for 2026 and 49,000 units for 2027 as regional uncertainty increases.