Rising Vehicle Demand Boosts North American Production: Scotiabank Global Auto Report

Global car sales remained strong in September, though the increase moderated to 3% year-over-year (y/y) from 6.5% in July and August, according to the latest Scotiabank Global Auto Report.

“The smaller gain reflects a temporary softening in sales in the U.S.,” said Carlos Gomes, Scotiabank’s senior economist and auto industry specialist. “In Canada, car and light truck sales continue to gain momentum. In October, purchases set a fourth consecutive monthly record, totalling a much stronger-than expected annual rate of 1.84 million units, up from an average of 1.73 million through September.”

Highlights in the report include:

* Rising vehicle demand across North America has boosted production on the continent, including Canada, to the highest level in nearly a decade, lifting operating rates and leaving some plants bursting at the seams.

* Car sales have accelerated in China, and picked up in Western Europe and South America. The bounce back in Brazil and Western Europe reflects improving consumer confidence and some stabilization in labour markets.

* While Mexico has been a big winner in attracting auto industry investment in recent years, capturing more than 14% of the North American total since 2010, only 60% of its vehicle production is exported to its NAFTA neighbours.

Read the full Scotiabank Global Auto Report at http://www.scotiabank.com/ca/en/0,,3112,00.html.

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