For the first time this year, auto sales in Canada were lower in May than in the same month a year earlier. Emphasizing the significance of that decrease, it’s only the second time since December, 2013 that year-over-year monthly sales have declined.
May sales of 194,866 new vehicles were down just 1.6 % from a year ago, however, and there were fewer selling days in the month this year. There were also the effects of the Alberta wildfire disaster to consider. And, according to David Adams, president of the Global Automakers of Canada, May sales were still 7.8% better than the five-year historical average for the month. So that turnaround is not necessarily a signal that that the long-running auto sales growth bubble has burst.
Still, while the percentage decline is modest, it comes on the heels of a three-month string of 8.2% average sales increases and the biggest sales month ever in April. In addition, the seasonally adjusted annualized sales rate (SAAR) fell to about 1.85-million units, continuing a four-month trend interrupted only by April’s anomalous performance.
Even that level is close to the 1.899-million record set in 2015, however. And current year-to-date sales of 798,089 vehicles remain 5.6% ahead of last year’s record pace. So, a new record at the end of 2016 is still possible, assuming that the momentum continues, noted Dennis DesRosiers of DesRosiers Automotive Consultants. And, according to Adams, “Consumer confidence remains strong having moved up 7.4 points over last month, which bodes well for the continued tracking towards record sales for 2016.”
As has become the norm, the strength in the market came from truck and utility vehicle sales, which were up 6.6% in May. It was a 12.7% reduction on the passenger car side that drove the overall decline. Year-to-date, trucks and utilities now command 64.9% of the market – a 5.1% increase from this time last year.
FCA back on top
Fiat Chrysler Auto’s sales were up just 0.3% in May, while Ford’s increased by 1.1%, but in overall numbers FCA’s 31,724 vehicles sold easily surpassed Ford’s 29,374 total. Ford had claimed the top spot for the past two months but FCA has held the year-to-date lead since January and continues to do so with 124,663 vehicles sold ( 3.1%), compared to Ford’s 121,143 ( 12.9%). Ford has gained a full percent in market share to 15.2%, however, while FCA dropped four-tenths to 15.6%. It promises to be an ongoing battle between the two for sales supremacy throughout the year.
Sales for third-place General Motors fell by 16.5% in April, although they’re still up 1.1% year-to-date. GM has lost a half-percent of market share year-to-date, down to 13.1%.
Behind those leaders, Toyota (-0.8%) remained unchallenged in fourth place, although gaining a bit on GM. Honda, in fifth showed the biggest improvement of the month among mainstream brands, with an 8.4% sales increase. It was followed in ranking order by Hyundai, ( 5.6%), Nissan ( 1.6%), Kia (-4.7%), Mazda ( 0.2%) and Volkswagen (-10.5%).
The biggest gainers were luxury brands: Volvo ( 18.9%), Audi ( 14.8%) and Jaguar ( 10.1%). At the spectrum were Smart (-70.7%) and Acura (-25.4%).
[NOTE: Data quoted in this report were sourced from DesRosiers Automotive Consultants, Global Automakers of Canada and individual automakers.]