Investment in the Canadian automotive industry is expected to hit a new high this year, according to DesRosiers Automotive Consultants (DAC).
In an update the firm said capital expenditures in the auto sector have seen large swings in the past few years, which they noted is often the case in an industry that includes what economists term “lumpy” capital investments. However, following the 2019 low of around $1.9 billion, 2024 is paving the way for a definite high point for the sector.
“The Canadian auto assembly space has been undergoing significant structural shifts in recent years,” said Andrew King, Managing Partner at DAC, in a statement. “Some of the future details of the transition may still be in flux, as Ford’s recent announcement for Oakville demonstrates, but what is clear is the immense scope of the changes that the industry is undergoing.”
DAC described this year’s potential high point as by far the “highest level of investment that the Canadian sector has seen in the time-series.” Capital expenditures are anticipated to reach over $6 billion, with most of that growth expected to stem from machinery and equipment investment for the assembly sector in Canada.
“With re-tooling in a number of assembly facilities ongoing or planned, investment into Canadian auto manufacturing in general is expected to be high,” said DAC.
