Global car sales regained momentum in September, showing its strongest performance since March.
The improvement was led by double-digit year-over-year (y/y) advances in North America and Western Europe, as well as a rebound in China after three consecutive months of declining volumes, according to the latest Scotiabank Global Auto Report.
In October, there was a further acceleration in North America, with purchases in the United States jumping 14% y/y to a higher-than-expected annual rate of 18.1 million units. In Canada, sales climbed to an all-time high of 2.01 million units in October, up from an average of 1.88 million through September.
“The North American auto industry is a key driver of overall economic activity and is outperforming other industrial sectors,” said Carlos Gomes, senior economist and auto industry specialist at Scotiabank. “The September and October sales results represent the best back-to-back monthly performance since the global economy was in the midst of the ‘tech boom’ in early 2000.”
Stronger economic conditions should continue to buoy industry volumes over the next several years, but significant concerns have been raised about the potential dislocation of sourcing patterns for vehicles and parts if the Trans-Pacific Partnership (TPP) is implemented.
“The TPP provides the North American auto industry with preferential access to the rapidly growing markets of Asia and South America, but reduces the rules of origin requirement for vehicles and parts that have been in place under the North American Free Trade Agreement (NAFTA). However, the strength of the North American auto industry is that it has become more innovative in recent years, responding better to pressures triggered by globalization and is in a much stronger competitive position than in the previous decade.”
Read the full Scotiabank Global Auto Report online.