August 13, 2008
Economy at a Glance - August 14, 2008
Motor vehicle sales are driving into some potholes
New and used motor vehicle retail sales in Canada were down slightly (-0.9%) on a three-month “smoothed” year-over-year basis in May 2008. However, the drop on an actual basis (-3.6%) was a little sharper. Neither of these figures is nearly as alarming as what is happening south of the border. In the United States, smoothed year-over-year new and used motor vehicle and parts sales are -8.3% and the actual decline has been -9.5%.
In Canada, further evidence of the changing pattern of sales in the auto industry can be found in the new motor vehicle sales report for May. Sales of trucks were -7.6% year over year in May, while passenger cars were +7.3%. The share of trucks within total sales was the lowest since October 2005.
The “trucks” category includes minivans, sport-utility vehicles, light and heavy trucks, vans and buses. The automakers lobbied hard to have SUVs included as trucks in order to avoid the tight fuel-efficiency standards required by passenger cars. By the way, in the passenger car segment, the clear leader is the “overseas-built” category (as opposed to North American-built), +15.3% year over year in terms of number of units in May.
As can be seen from the accompanying charts, Canadian total retail sales have been following U.S. levels downward over the past four months. The U.S. decline has been led by an auto sector that has been speeding downhill for eight straight months.
For more articles by Alex Carrick on the Canadian and U.S. economies, visit his blog and Market Insights.
Canada vs U.S. Retail Sales – Total
Canada vs U.S. Retail Sales – New and Used Vehicles and Parts
*“Year over Year” is the monthly figure versus the same month of the previous year.
Based on latest three-month averages of current dollar adjusted data (and placed in the latest month).
Data source (seasonally adjusted): Statistics Canada/Charts: Reed Construction Data - CanaData.
