US light vehicle sales in 2003 could fall by a half million to 1.2 million units, or as much as 7%, if the U.S. fights a war with Iraq, an analyst said, according to Bloomberg News.
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Car and truck sales in 2003 should reach 17 million, unchanged from 2002, without conflict, George Magliano, director of automotive industry research at Global Insight, (formerly DRI-WEFA) told Bloomberg News.
“A quick victory” would trim that forecast by 500,000 vehicles because people would be “sitting at home watching TV,” Magliano told Bloomberg News in an interview.
A longer war that triggers a stock market sell-off or pushes the economy into recession would cut sales by 1.2 million vehicles, he added, according to Bloomberg News.
Bloomberg News said Iraq has until Friday to say whether it will accept full inspections for chemical, biological and nuclear weapons under a United Nations Security Council resolution approved last week.
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By GlobalDataThe US has said it is considering military options if Iraq’s President Saddam Hussein fails to comply with the resolution, the news agency added.
Magliano told Bloomberg News that the vehicle market is healthier today than it was in 1991, when the US fought a war against the Iraqi leader. The economy is stronger, interest rates are lower and vehicle sales are higher now than they were then, he added, according to Bloomberg.
“It’s a night-and-day difference,” he told Bloomberg News. Any lost sales from a war next year would only be “delayed,” and would take place later. “You would come back strong the next year,” he reportedly said.
Bloomberg News said US vehicle sales fell to 13.89 million in 1990 from 14.55 million in 1989. They fell to 12.33 million in 1991.
Global Insight analyst Colin Couchman told Bloomberg News that a war with Iraq could cut Western European sales by 3%, or about 450,000 cars.
