While Canadian auto sales bounced back strongly in the second half of 2020, to within 5% of pre-COVID figures, they’re off to a much rockier start for 2021.
DesRosiers Automotive Consultants (DAC) estimates total sales of 90,890 units for the month, down 17.4% from January of last year, which was roughly representative of average sales for the five years prior. So it’s a significant decline from the norm.
That point is reinforced by an estimated January SAAR (Seasonally Adjusted Annualized Sales Rate) of just 1.66 million, down 340,000 units from January 2020, according to DAC Managing Partner, Andrew King.
This decline should come as no surprise, King said, “with the whole country in various degrees of lockdown, and the auto industry still working through supply chain disruptions.”
Rebekah Young of Scotiabank Economics concurred, noting that the vast majority of the Canadian economy was under stringent COVID-19 restrictions for most of the month. “So this (damping of sales) in January is not alarming,” she said. “The weakness is likely transitory and could be expected to fuel some pent-up demand in the months ahead,” she added.
She also cautioned that there is still potential for continued volatility in monthly sales over the next couple of quarters as COVID-19 still circulates and inventory shortages persist.
While it is early days yet, Scotiabank optimistically forecasts a rebound to 1.8-million full-year sales in 2021, “with improvements weighted towards the second half of the year, once immunizations are broad-based and fleet(s) comes back on line as travel resumes.”
Negative year-over-year results from most reporting brands
With only a handful of OEMs providing monthly sales reports now, it’s difficult to get a broad-based sense of who and what is doing well. Apart from trucks, that is. DAC estimated the light truck share for the month to be 84.6%, breaking through the 80% threshold as crossovers, SUVs and pick-ups continued to make relative market gains.
Of those automakers that did reveal January sales figures experienced mostly negative results, compared to their own figures from a year ago.
The two exceptions were Mazda, which continued its late-year 2020 momentum with a 7.6% January gain, and Volvo, with sales up by 1.1%.
Toyota reported an 11.8% decline for the month, and Subaru -10.0%, both beating the -17.4% market average, while Lexus sales declined by 26.3%.
