Canada auto
sales to reach two million units in 2017
TORONTO, June 22, 2017 /CNW/ - Global car sales fell 2.5%
below a year earlier in April, marking the first monthly
year-over-year decline in nearly two years. The April fall-off was
broad-based, but largely reflects temporary distortions. More
recent sales data for May point to a reversal of the April slowdown
across many countries, including Canada and Mexico.
Canadian auto sales have exceeded expectations this year as
strengthening economic growth has led to a sharp rebound in
purchases in the resource-rich Prairie provinces, particularly
Alberta, including a recovery in
fleet volumes. Car and light truck sales surged 11% y/y in
Canada last month – the largest
gain in almost three years.
"We've raised our 2017 Canadian sales forecast to 2 million
units, up from 1.94 million due to a stronger-than-expected
recovery in the Prairies," said Carlos
Gomes, Senior Economist and Auto Industry Specialist,
Scotiabank. "The car and light truck sales acceleration in the
Prairies this year includes an 18% y/y surge in May—the largest
increase in more than four years. In fact, the Prairies are the
only region to post double-digit sales gains so far this year,
accounting for 37% of the overall increase in Canadian new vehicle
sales through May or more than double its historical share of the
Canadian new vehicle market."
A double-digit increase in capital spending by the oil patch in
2017 has also led to additional business purchases of new cars and
light trucks. Fleet volumes at Calgary dealerships have surged 20% y/y
through April, and accounted for nearly 70% of all new fleet
activity across Alberta. In fact,
the surge in Calgary's fleet
volumes represents half of the nationwide increase through the
first four months of the year. While Alberta is the key driver of decade-high fleet
volumes in Canada in 2017, sales
to businesses have also picked up in several other provinces
alongside a strengthening corporate profit outlook.
Other highlights:
- Leading economic indicators for the U.S. and Western Europe continue to accelerate.
- Business investment is gaining momentum across both developed
and emerging markets.
- New vehicle purchases by U.S. households bounced back in May,
lifting industry transactions prices 2% above a year earlier.
- Vehicle sales in Mexico have
fully recovered from the April decline, setting a record for the
month of May.
Read the full Scotiabank Global Auto Report online at:
http://www.scotiabank.com/ca/en/0,,3112,00.html.
Scotiabank provides clients with in-depth research into the
factors shaping the outlook for Canada and the global economy, including
macroeconomic developments, currency and capital market trends,
commodity and industry performance, as well as monetary, fiscal and
public policy issues.
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SOURCE Scotiabank