New motor vehicle sales

New motor vehicle sales started to recover in October, gaining 3.3% after two months of sharp declines. Dealers saw 131,455 new vehicles roll out of their showrooms in October, an increase of about 4,000 vehicles over the previous month.

The number of vehicles sold nation-wide has returned to a level more in line with recent historical trends following the winding down of "employee pricing" and other incentive programs, which had sparked a sizeable upswing in sales over the summer.

The upward trend in new motor vehicle sales since the start of 2005 has faltered in recent months, while exhibiting sizeable volatility. In 2004, new motor vehicle sales remained relatively stable, after a series of increases early in the year.

Although both car and truck sales advanced in October, most of the gain came from an improvement in truck sales. The truck segment (which includes minivans, sport-utility vehicles, light and heavy trucks, vans and buses) has been the main force behind the significant swings in sales observed in the past five months. After two months of sagging sales, truck sales turned a corner, gaining 6.7% in October. However, despite this gain, they remain close to a two-year low.

Based on preliminary figures from the auto industry, the number of new motor vehicles sold rose approximately 3% in November, continuing to regain lost ground. The gain was almost entirely attributable to trucks.

Truck sales recover somewhat after end of summer slump

Despite a resurgence in October, truck sales remained about 20% lower than the peak reached in July of 2005. Sales reached 60,756 units in October, about 4,000 vehicles less than an average month in 2005.

With a slight 0.6% uptick in October, car sales reached 70,699 vehicles, very close to an average month of sales in 2005. Although passenger car sales also peaked in July, its fluctuations have not been as pronounced as those of truck sales in recent months. Sales of both North American-built and overseas-built cars increased slightly during the month.

Until this summer, sales of both cars and trucks had maintained an upward trend in 2005, despite major fluctuations. However, in recent months, sales of passenger cars have softened, while truck sales have moved more sharply downwards. In 2004, sales remained relatively stable for cars and trucks after some sizeable increases early in the year.

Weakness out West

In October, provincial results were evenly split with half of the provinces posting gains and the other half declining. The largest percentage sales increase came in Prince Edward Island (+16.3%), while Quebec (+11.2%) accounted for the largest increase in units sold. On the other hand, Saskatchewan had the strongest decline in October, dropping 9.3%.

Sales out West, including the Prairies and the region formed by British Columbia and the territories, continued to slump in recent months. All four of the western provinces had three consecutive months of sales decreases up to and including October.

Available on CANSIM: tables 079-0001 and 079-0002.

Definitions, data sources and methods: survey number 2402.

The October issue of New Motor Vehicle Sales (63-007-XIE, $14/$133) will be available soon.

Data on new motor vehicle sales for November will be released on January 13, 2006.

For general information or to order data, contact Client Services (1-877-421-3067; 613-951-3549; retailinfo@statcan.gc.ca). To enquire about the concepts, methods or data quality of this release, contact Elton Cryderman (613-951-0669), Distributive Trades Division.