Canada and the United States are heading in different directions when it comes to auto sales.
Scotiabank is now forecasting Canadian vehicle sales to reach two million in 2017, up from 1.94 million in 2016. DesRosiers Automotive Consultants also reported that one million new vehicles were sold in the first half of the year, the first time that has ever happened.
Meanwhile, J.D. Power and LMC Automotive saw June U.S. sales hit the lowest mark they’ve seen for the month since 2012.
An announcement from Scotiabank said auto sales in Canada have grown beyond expectations so far this year thanks to economic growth, primarily from the Prairie provinces, notably Alberta. Car and truck sales, it said, are up 11 per cent year over year, making it the largest gain in three years.
“In fact, the Prairies are the only region to post double-digit sales gains so far this year, accounting for 37 per cent of the overall increase in Canadian new vehicle sales through May or more than double its historical share of the Canadian new vehicle market,” said Carlos Gomes, senior economist and auto industry specialist at Scotiabank.
Capital spending by oil patch companies has resulted in increased purchases of cars and trucks by businesses. In Calgary in particular, fleet volume sales have jumped by 20 per cent from last year and sales in the city represent half of the increase in fleet sales across the country.
In the U.S., J.D. Power and LMC Automotive are projecting sales to be down 1 per cent over the first half of the year. “The auto industry is pacing towards its weakest first half since 2014,” said Deirdre Borrego, senior vice president of automotive data and analytics at J.D. Power.
Fleet sales in the U.S. are not seeing the same success as in Canada, as those are expected to be down almost 6 per cent from June of last year. Fleet sales, said Jeff Schuster, senior vice president of forecasting at LMC Automotive, are “the primary driver of the decline in the total sales pace.”
That said, it is expected that 17.1 million vehicles will be sold in 2017 in the U.S. and “a year still expected above 17 million units should not be considered a poor performance,” he added.