articles Ratings /ratings/en/research/articles/200505-covid-19-will-further-slow-demand-for-heavy-trucks-11470890 content esgSubNav
In This List

COVID-19 Will Further Slow Demand For Heavy Trucks


Key Themes 2023: What We're Watching


Rated Singapore REITs: The Best Assets Will Withstand Demand Softening


Instant Insights: Key Takeaways From Our Research


2023 U.S. Residential Mortgage And Housing Outlook: Navigating A Softening Market

COVID-19 Will Further Slow Demand For Heavy Trucks

Chart 1


Chart 2


While China appears to be gradually recovering after the imposed lockdown due to the COVID-19 outbreak, other regions are still testing their ability to curb the virus. Our expectations for the global commercial vehicle market will likely evolve throughout the second quarter (Q2) of 2020 as more information becomes available. We acknowledge that there is a high degree of uncertainty about the rate of spread and peak of the coronavirus outbreak. Some government authorities estimate the pandemic will peak about midyear, and we are using this assumption in assessing the economic and credit implications. We believe the measures adopted to contain COVID-19 have pushed the global economy into recession (see our macroeconomic and credit updates here: As the situation evolves, we will update our assumptions and estimates accordingly.

Based on our macroeconomic forecasts, we expect a material decline in truck demand globally as customers postpone and cancel orders. We expect this decline will be particularly severe in the second quarter of the year, only gradually recovering thereafter, provided restrictive measures are effective in slowing contagion. Apart from the expected GDP declines, we believe other key factors will influence heavy-duty truck demand, such as the average fleet age and regulatory actions.

Under our scenario, we now forecast global heavy-duty commercial vehicle sales will decline by about 20%-30% in 2020 to about 1.7 million units. This compares to 2019 sales of 2.3 million. For 2021, we expect sales volumes to recover globally by between zero and 10% (see table 1).

Table 1

Global And Regional Heavy-Duty Truck Sales Year-On-Year Changes (%)
% 2017* 2018* 2019* 2020e** 2021e**
Europe 9.4 1.4 (0.6) (30)-(40) 15-25
APAC 42.7 6.6 (5.7) (10)-(20) (10)-0
North America 0.6 25.4 6.8 (50)-(60) 30-40
South America 19.5 33.3 17.6 (10)-(20) 20-30
Total 28.6 8.6 (2.4) (20)-(30) 0-10
*LMC data. **S&PGR forecasts.

In response to fading demand and supply-chain shortages related to the Chinese market shutdown and difficult deliveries, the vast majority of global truck manufacturers announced production shutdowns of their plants in Europe and in the U.S. in Q1, and have switched to liquidity protection mode in anticipation of a sharp decline in Q2. Some companies, for example, have cancelled dividends, secured additional committed lines, and are carefully evaluating capex and costs.

Currently, global truck manufacturers are testing their production and supply chains, and have either already started to gradually reopen plants, or expect to do so. Nevertheless, we expect intense credit pressures ahead for truck makers. We believe that potential government stimulus packages and central banks' action to facilitate access to funding will only partially relieve these pressures.

Chart 3


In the eurozone, we now expect real GDP to fall by 7.3% in 2020, after 1.2% growth in 2019. In 2021, we forecast eurozone GDP will rebound to 5.6%. On the back of this, we believe heavy-duty truck sales in the region are likely to decline by between 30% and 40% this year, depending on the speed of recovery in the second half of 2020. For 2021, we expect pronounced growth ranging between 15% and 25%, but not enough to fully cover 2020 volume losses.

In the U.S., revised real GDP forecasts indicate a decline of 5.2% in 2020, after 2.3% growth recorded in 2019. For 2021, we now expect real GDP to expand steeply by 6.2%. Given the already bearish environment in the heavy-duty truck market, which even before the COVID-19 pandemic was suffering from oversupply, we now forecast a 50%-60% decline in 2020 sales volumes, nevertheless resulting in volumes in absolute terms still above 2009. We forecast sales volumes will improve in 2021 in the range of 30%-40%.

Despite evidence of a recovery in China, under our revised macroeconomic assumption, we think it is likely that real GDP for APAC will grow by just 0.7% in 2020, after 4.8% growth recorded for 2019. This would translate into a decline in commercial vehicle sales by about 10%-20% this year. For the moment, we see real GDP growth of 6.3% in 2021. However, we still forecast another sales contraction for heavy-duty trucks in APAC in 2021 of up to 10%. We expect demand to further soften in China from a high base created in 2017-2020. This is mainly because of the recent fleet expansion after regulation changes and the scheduled implementation of higher emission standard in 2021.

Related Research

  • COVID-19 Will Batter Global Auto Sales And Credit Quality, March 23, 2020
  • COVID-19 Deals A Larger, Longer Hit To Global GDP, April 16, 2020

This report does not constitute a rating action.

Primary Credit Analyst:Marta Bevilacqua, Milan + (39)0272111298;
Secondary Contacts:Grant Hofmeister, New York + 1 (212) 438 8855;
Chloe Wang, Hong Kong + 852-25333548;
Vittoria Ferraris, Milan (39) 02-72111-207;
Robyn P Shapiro, New York (1) 212-438-7224;

No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor’s Financial Services LLC or its affiliates (collectively, S&P). The Content shall not be used for any unlawful or unauthorized purposes. S&P and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively S&P Parties) do not guarantee the accuracy, completeness, timeliness or availability of the Content. S&P Parties are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, for the results obtained from the use of the Content, or for the security or maintenance of any data input by the user. The Content is provided on an “as is” basis. S&P PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE, FREEDOM FROM BUGS, SOFTWARE ERRORS OR DEFECTS, THAT THE CONTENT’S FUNCTIONING WILL BE UNINTERRUPTED OR THAT THE CONTENT WILL OPERATE WITH ANY SOFTWARE OR HARDWARE CONFIGURATION. In no event shall S&P Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs or losses caused by negligence) in connection with any use of the Content even if advised of the possibility of such damages.

Credit-related and other analyses, including ratings, and statements in the Content are statements of opinion as of the date they are expressed and not statements of fact. S&P’s opinions, analyses and rating acknowledgment decisions (described below) are not recommendations to purchase, hold, or sell any securities or to make any investment decisions, and do not address the suitability of any security. S&P assumes no obligation to update the Content following publication in any form or format. The Content should not be relied on and is not a substitute for the skill, judgment and experience of the user, its management, employees, advisors and/or clients when making investment and other business decisions. S&P does not act as a fiduciary or an investment advisor except where registered as such. While S&P has obtained information from sources it believes to be reliable, S&P does not perform an audit and undertakes no duty of due diligence or independent verification of any information it receives. Rating-related publications may be published for a variety of reasons that are not necessarily dependent on action by rating committees, including, but not limited to, the publication of a periodic update on a credit rating and related analyses.

To the extent that regulatory authorities allow a rating agency to acknowledge in one jurisdiction a rating issued in another jurisdiction for certain regulatory purposes, S&P reserves the right to assign, withdraw or suspend such acknowledgment at any time and in its sole discretion. S&P Parties disclaim any duty whatsoever arising out of the assignment, withdrawal or suspension of an acknowledgment as well as any liability for any damage alleged to have been suffered on account thereof.

S&P keeps certain activities of its business units separate from each other in order to preserve the independence and objectivity of their respective activities. As a result, certain business units of S&P may have information that is not available to other S&P business units. S&P has established policies and procedures to maintain the confidentiality of certain non-public information received in connection with each analytical process.

S&P may receive compensation for its ratings and certain analyses, normally from issuers or underwriters of securities or from obligors. S&P reserves the right to disseminate its opinions and analyses. S&P's public ratings and analyses are made available on its Web sites, (free of charge), and and (subscription), and may be distributed through other means, including via S&P publications and third-party redistributors. Additional information about our ratings fees is available at

Any Passwords/user IDs issued by S&P to users are single user-dedicated and may ONLY be used by the individual to whom they have been assigned. No sharing of passwords/user IDs and no simultaneous access via the same password/user ID is permitted. To reprint, translate, or use the data or information other than as provided herein, contact S&P Global Ratings, Client Services, 55 Water Street, New York, NY 10041; (1) 212-438-7280 or by e-mail to:

Register with S&P Global Ratings

Register now to access exclusive content, events, tools, and more.

Go Back