April sales remain solid

New-vehicle sales in Canada remained strong in April, following a record-setting March. Overall sales of 159,942 vehicles were up 6.9 percent from April 2010 and, for the second month in a row, the seasonally adjusted annual sales rate (SAAR) topped 1.6 million.

That said, the SAAR for April fell slightly from March’s 1.66-to-1.67 million range to the 1.64-to-1.66 million range (Scotiabank and DesRosiers Automotive Consultants figures, respectively). It’s a good result as it’s the first time since 2008 that the SAAR was consecutively over 1.6 million, month-to-month.

In absolute numbers, April’s sales were below the peak levels of 2007 and 2008 but 0.9 percent above the five-year average for the month.

Those solid results kept year-to-date figures 3.6 percent ahead of the same period last year and 1.1 percent up on the five-year average.

Nevertheless, says Dennis DesRosiers, “The market has a long way to go before we can safely say that the vehicle markets have returned to more normal levels.”

Trucks maintained their sales dominance over passenger cars in April, claiming 53.9 percent of the market, but – for the first time since October 2008 – the rate of year-over-year increase in passenger car sales surpassed that of light trucks (+8.0% vs +5.9%).

As a result, the year-to-date truck share of the market fell from 57.9 percent to 56.2 percent. Scotiabank senior economist, Carlos Gomes attributes the improvement in car sales to a shift to smaller, more fuel-efficient vehicles, a trend that began as oil prices surpassed US$100 per barrel in March.

(See accompanying table for detailed sales figures.)

Imports fight back

While the Detroit Three (+5.3 % collectively for the month) have been taking back share from the important brands in recent months, the imports fought back in April (+8.2 %) to claim 55.0 percent of the market, in spite of supply issues resulting from the Japanese earthquake and tsunami.

In spite of those April results, the Detroit Three have regained 1.5 points of market share (46.0%) compared to the same time last year.

Chrysler (+15.4%) led the Detroit brands in terms of year-over-year improvement, claiming second place in sales for the month. Ford (+9.0%) continued to be Canada’s best-selling brand for the month and year-to-date.

General Motors (-3.5%) dropped to third place for the month, although it retains second place year-to-date. Toyota (+8.6%) maintained fourth place but Hyundai (+14.2%) once again claimed fifth, dropping Honda (-4.2%) to sixth for the month and year-to-date.

Among luxury brands, BMW (+4.5%) bounced back to claim the sales lead over Mercedes-Benz (-0.6%) for the month, but Mercedes remains well ahead year-to-date.

In percentage terms, Porsche (+43.6%) made the greatest gains for the month, followed by Kia (34.0%), Smart (+26.8%) and Volkswagen (+25.8%).

While most brands enjoyed increased sales over last year, that wasn’t the case for all. Those losing ground included: Acura (-20.3%); Suzuki (-39.5%); Mazda (-9.2%); Infiniti (-8.5%); and Honda (-4.2%).

Year-to-date, the big gainers are: Porsche (+41.1%); Kia (+28.0%); and Audi (+19.4%). The biggest losers are: Suzuki –32.5%); Acura (-17.1%); Mazda (-17.1%); Acura (-15.5%); and Smart (-15.6%).

Five-year History

Relative to the past five-year averages for April, those making the biggest gains were: Audi (+78.3%); Kia (+74.4%); Hyundai (+53.6%); Volkswagen (+56.7%); Subaru (+49.7 %); Mercedes-Benz (+41.1%); and Porsche (+40.7%).

Those with the greatest declines in a five-year average (excluding Saab, which was out of the market last year) were: Suzuki (-39.9%); General Motors (-35.3%); Acura (-21.1%); Infiniti (-18.5%); Honda (-17.9%); Jaguar (-14.3%); and Mazda (-14.2%).

Looking Ahead

With further supply constraints now certain, as a result of the Japanese disaster, DesRosiers expects the next quarter to be “quite soft.” Sufficiently so, he’s “pulling 45,000 units” out of his second and third quarter forecasts and pushing them into the fourth quarter of 2011 and first quarter of 2012.