Canadian Vehicle Sales Forecast to Level Off in 2016: Scotiabank
TORONTO, ON --(Marketwired - January 27, 2016) - Canadian auto sales climbed a stronger-than-expected 3% last year to a record 1.9 million units and are forecast to be largely flat in 2016, according to the Scotiabank Global Auto Report released today.
"Car and light truck sales will continue to be supported by low interest rates and stimulative financial conditions around the world," said Carlos Gomes, Senior Economist and Auto Industry Specialist at Scotiabank. "Economic activity and demand for new vehicles will continue to be buoyed by the strongest advance in Canadian non-resource exports since the new millennium, as well as by strengthening U.S. demand and a currency which recently fell below 70 cents (US) for the first time since early 2003.
"Diverging trends between the industrial heartland and commodity-producing regions are expected to balance each other out in 2016, keeping volumes unchanged. Stronger employment growth and economic activity in the export-reliant manufacturing provinces will lift sales in these markets, but deteriorating fundamentals and weakening demographic and income trends will continue to pressure volumes in other regions."
Other highlights from the report include:
-- Even with sluggish global demand, 17 out of Ontario's 21 manufacturing
sectors posted double-digit export gains in 2015.
-- Broad-based manufacturing export gains are also expected to lift
economic activity and vehicle sales in British Columbia and Quebec in
2016. Strengthening exports are particularly evident in British
Columbia, with nearly half of all manufacturing industries posting
export growth in excess of 20% in 2015.
-- In Alberta, vehicle sales declined 12% last year to 236,000 units. A
further slide to 220,000 is projected for 2016, as oil companies
continue to curtail their capital expenditures and the labour market
weakens amid a large overhang in global crude oil inventories.
-- Vehicle sales in the remaining provinces were in line with expectations
last year. Volumes declined in Saskatchewan and Newfoundland, undercut
by the downturn in the energy sector, and were unchanged in Manitoba and
edged higher across the Maritimes.
Read the full Scotiabank Global Auto Report online at:
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