New motor vehicle sales

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Sales of new motor vehicles began 2008 with the strongest month-to-month growth in two and a half years. Seasonally adjusted data from the New Motor Vehicle Sales survey show that 153,231 units were sold in January, up 8.2% from December. This was the largest monthly growth since June 2005 when sales grew 8.9%.

The growth in January followed a 5.1% increase in December sales. Prior to December, sales had decreased six times in seven months.

Looking ahead, preliminary industry data for February suggest that some of January's gains will be lost due mainly to a decline in truck sales.

Sales of passenger cars surge ahead in January

January's growth was almost entirely due to an increase in passenger car sales. There were 80,754 new passenger cars sold in January, up 16.2% compared with December. This was the largest month-to-month increase in passenger car sales since February 1998, the month after a major ice storm hit Quebec and Ontario. Additional rebates, as a result of new Canadian prices and incentives to draw customers into the showrooms, such as better financing, along with a one percentage point reduction in the goods and services tax, appear to have paid off for new car dealers.

Of the new passenger cars sold in January, 53,049 were North American-built, representing a surge of 21.9% over unit sales in December. This increase more than compensated for the cumulative declines of the previous three months and was the biggest single monthly jump in unit sales of North American-built passenger cars since January 1991. Unit sales of overseas-built passenger cars rose 6.7% in January to 27,706 units, continuing the growth from December's 10.1% increase.

Sales of new trucks (which include minivans, sport-utility vehicles, light and heavy trucks, vans and buses) edged up 0.5% in January to 72,476 new units sold. This relatively flat month comes on the heels of a volatile six month period in truck sales.

Quebec drives national increase as all provinces post gains

While sales increased across the country in January, provinces where passenger cars contribute the most to new motor vehicle sales led the way. A sizeable increase in the number of new motor vehicle sales in Quebec (+16.1%) to 39,953 units contributed the most to the Canadian increase. Ontario (+6.9%) added the second largest amount to national sales growth in January with 54,558 units.

Like Quebec, a relatively large portion of the new motor vehicle market in Atlantic Canada comes from passenger car sales. Newfoundland and Labrador (+31.3%) experienced the largest percentage growth in sales in January with Nova Scotia (+12.5%) and Prince Edward Island (+9.9%) posting strong gains as well.

In the four westernmost provinces, where a larger portion of the market comes from truck sales as opposed to passenger car sales, growth was less pronounced. Manitoba (+7.0%) led the way in this group with sales also increasing in Saskatchewan (+3.2%), Alberta (+2.2%) and British Columbia (+1.2%).

Note: Effective with this release, a new table will replace tables 079-0001 and 079-0002, which will no longer be available. To help users convert from the current CANSIM tables to the new table 079-0003, a concordance table between the old and new vector numbers is available.

Available on CANSIM: table 079-0003.

Definitions, data sources and methods: survey number 2402.

The January 2008 issue of New Motor Vehicle Sales (63-007-XWE, free) will be available soon.

Data on new motor vehicle sales for February will be released on April 14.

For general information or to order data, contact Client Services (toll-free 1-877-421-3067; 613-951-3549; retailinfo@statcan.gc.ca). To enquire about the concepts, methods or data quality of this release, contact Joseph Dunlavy (613-951-0193), Distributive Trades Division.

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