After setting a new SAAR (Seasonally Adjusted Annual Rate) high for the year in June, new-vehicle sales in Canada plunged again in July continuing the topsy-turvy ride that has characterized the year to date.
That’s no surprise to those in the know as June’s big numbers were heavily influenced by big incentives. As one automaker executive told us, “We bought June!”
July’s sales of 141,472 vehicles were down 4.9 percent from the same month last year, dragging the year-to-date figure back to just 1.5 percent above 2010. It was up by 2.7 percent at the end of June.
Compared to the five-year average for the month, July’s sales were 2.1 percent below the norm and year-to-date was off by 0.9 percent.
In spite of the decline from last July, the SAAR for the month remained relatively strong at 1.61 million (DesRosiers figure), which is about where the market is tracking year-to-date – an improvement from last year but well below the peaks of 2006 through 2008.
In fact, as Dennis DesRosiers points out, if you factor out the volatility of the monthly fluctuations, the SAAR has been relatively stable just below 1.6 million for the past 18 months.
While that’s by no means a bad place to be, DesRosiers says it well below what Canada’s current economy should support. “If you did an analysis of the fundamentals of the Canadian market and what the market potential should be,” he says, “you can build a case that the Canadian market should be up in the 1.8 million range and possibly even higher.”
He adds: “We can be pleased with a 1.6 million tracking but we are still very much below where the market should be.
Detroit Three gain share
Collectively, Detroit Three sales decreased by 3.3 percent in July – beating the market average and the import brands whose collective sales fell by 6.4 percent.
As a result, the D3 claimed a 50.1-percent share of the market for the month and improved their year-to-date market share to 48.1 percent – an improvement of 0.3 percent from last month ad 1.7 percent from a year ago.
As has become the recent norm, Chrysler (+4.5% from July 2010) was the biggest gainer of the Detroit Three for the month. Chrysler’s sales were also up 24.2 percent from their five-year average and the company’s market share, year-to-date, advanced by 1.6 percent to 15.2 percent.
Ford’s sales improved by just 0.5% from last July, but they were up 18.6 percent from their 5-year average for the month. Once again, Ford was first in the sales race for both the month and the year.
General Motors’ July sales were down 14.9 percent from last year and 27.9 percent from their five-year norm, dropping them behind Chrysler to third place for the month and dropping GM’s year-to-date market share another tenth to 15.3 percent.
Japanese still flounder
The decline in import-brand sales and share in July was due solely to the continued difficulties of the Japanese brands, particularly Honda (-24.8%) and Toyota (-17.9%).
Combined sales of Japanese brands were down 16.7 percent in July, with only Mitsubishi (+0.6%) showing an improvement from last year.
In addition to Honda and Toyota, Suzuki (-50.8%), Infiniti (-28.2%), Lexus (-22.1%), Acura (-18.7%), Subaru (-18.0%), Mazda (-9.3%) and Nissan (-7.6%) all experienced declines.
Sales of European brands were up 9.2 percent while those from Korea improved by 11.5 percent.
Hyundai (+10.9%) again claimed fourth place in sales, ahead of Toyota, while Kia (+12.9%) continued to gain share (+0.8% to 4.2% year-to-date).
Among European brands, Smart (+123.3%), Volkswagen (+16.5%), Mini (+14.3%), Audi (+14.2%), BMW (+14.1%), Land Rover (+21.2%), and Volvo (+3.4%) all improved their sales over last July.
On the negative side of the ledger were Porsche (-19.4%), Jaguar (-11.9%) and Mercedes-Benz (-3.8%).
BMW again outsold Mercedes-Benz, giving it the luxury car lead for the month, but not yet for the year-to-date.
Truck sales were down percent in July, while passenger car sales fell by 6.1 percent. Year-to-date shares remained constant with trucks at 55.1 percent and passenger cars 44.9 percent.
