The ongoing war between the United States and Iran is no longer affecting only politics and oil prices. It is now creating serious pressure on the global automotive industry, with forecasts suggesting losses could exceed 1.4 million vehicles over the next two years.
As tensions continue to rise across the region, the Strait of Hormuz has become one of the biggest concerns for automakers and shipping companies. Although the waterway has not been officially closed, many shipping firms are already treating it as a dangerous route, forcing them to avoid it or search for safer alternatives.
That shift is creating major supply chain disruptions, especially since the Strait of Hormuz is one of the world’s most important routes for transporting oil and goods. The longer the crisis continues, the more expensive shipping, insurance, and logistics become, directly increasing the cost of new vehicles.
According to S&P Global Mobility, if the current situation continues through the end of April, global light-vehicle sales could decline by 800,000 to 900,000 units during 2026 alone.
The Gulf region could face even bigger challenges, as Gulf Cooperation Council countries rely heavily on imported vehicles arriving by sea. Estimates suggest the region could lose around 200,000 vehicle sales next year because of supply shortages, delayed shipments, and rising prices.
Consumers in Saudi Arabia, the UAE, Qatar, Kuwait, Bahrain, and Oman are expected to feel the impact clearly through higher vehicle prices, longer waiting times, and fewer models available in showrooms.
The crisis is also expected to affect manufacturing. Rising oil prices and disrupted supply chains could place major pressure on factories in countries such as Japan, South Korea, and China, which depend heavily on stable energy supplies and raw materials.
There are also growing concerns over shortages of essential materials used in vehicle production, including aluminum, methanol, bromine, and helium, which is used in semiconductor manufacturing.
S&P believes shipping activity in the region will not return to normal quickly, even if the war ends soon. Ports and shipping routes are not expected to fully recover before the second half of 2026.
The impact could continue into 2027, with another 500,000 vehicles potentially lost that year, pushing total losses beyond 1.4 million units.
If the conflict continues for a longer period or expands into a wider regional war, the consequences for the automotive industry could become even more severe in terms of production, pricing, and sales.
While the world waits for a political breakthrough that could reduce tensions, the automotive industry now appears to be one of the sectors most exposed to any further instability in the region.
