The question is, “Is it sustainable?”
February’s new-vehicle sales in Canada were not only up by 24.9 percent over the same month last year – which was a very low base for comparison – they were up by 2.7 percent over the average for the past five years.
That’s the best news the industry has seen in well over a year, suggesting that, for this month at least, sales are returning to what we have become accustomed to as a normal pace.
In fact, the seasonally-adjusted annual sales rate (SAAR) for the month was approximately 1.70 million units according to Scotiabank chief economist, Carlos Gomes – well above the 1.46-million level reached in 2009 and the similar rate for January 2010.
It’s far too early to suggest that things really are back to normal, or that such a SAAR is sustainable. But while the “outsized jump” in February’s numbers “may overstate the strength of the market,” Gomes says, “we expect purchases to continue to move higher alongside an improving labour market and a broadening economic recovery.”
Almost every manufacturer saw sales increase in February, year-over-year – some by significant amounts.
Ford claims top spot
Both General Motors (+21.7%) and Chrysler (+17.2%) improved as well, but not nearly as much as Ford, resulting in the Blue Oval claiming the number one sales position, followed by Chrysler, then GM. Their combined market share of 46.2 percent was second best only to January’s results over the past year and up almost five percentage points from where it was running last fall.
In spite of its recall woes, Toyota’s 25.2-percent increase put it firmly into fourth place. And although Honda improved by a third over last February, Hyundai (+23.0%) still slipped past to take fifth position.
As was the case in January, trucks outsold cars by a dramatic margin in February, claiming 55.2 percent of the market – although that number may not mean much given the broad range of purely passenger vehicles that are now classified as trucks.
Three-month view
Given that the December-February three-month sales figures from a year ago were the worst for the period in recent history, it’s not surprising that this year’s figures are up substantially – by 16.5 percent overall. And all but three manufacturers showed gains over last year. The three exceptions were Suzuki (-5.5%), Acura (-15.7%) and Saab (-72.0%), which is currently out of the market.
While all the rest improved from last year, fewer than half outpaced the industry average. They were: Volvo (+56.2%); Kia (+41.7%); Lexus (+39.9%); Audi (+39.7%); Subaru (+35.7%); Land Rover (+34.4%); Toyota (+30.6%); Hyundai (+29.3%); Ford (+27.9%); Mercedes-Benz (+27.0%); and Mini (+20.7%). The rest all lagged the market average.
While that average is much improved from a year ago, and that is a significant step, it is 2.2 percent behind the average for the period for the past five years – and 12.2 percent lower than the same period two years ago.
So, whether the glass is half-full or half-empty depends on your point of view. One thing that is for sure is that the industry is in far better shape than it was a year ago. And February’s results provide reason to hope that it will keep on getting better.
