As I write this, the calendar has turned over to March 1. The CADA Summit and Toronto AutoShow are in the rear-view mirror. The Montreal AutoShow and the CCAM Summit a bit further back.
Every year I find this a great time to reflect on where the industry stands and consider the things that are dominating my radar. So, in no particular order, here’s what’s top of mind.
The CADA Summit drew the largest crowd — and sold out faster — than any in the event’s nearly fifteen-year history. That, in part, reflects the sense of urgency dealers and others in the industry are feeling right now. We very likely sit on the edge of big changes: to the brands we make in Canada; to the brands we sell in Canada; and to the AI-driven tools dealers have available to run their businesses and connect with customers. Changes are coming fast. Dealers need answers, and they came out to help find them.
The urgency Chinese manufacturers feel to find new markets will put a lot of pressure on the slightly-opened door that allows 49,000 vehicles into Canada nearly tariff-free. The China-Canada deal still seems thin on details, but my expectation is that number will change. Forgive the expression, but it feels a bit half-pregnant. If we’re going to open the door to Chinese-made vehicles, I expect the numbers to become much more significant.
I think dealers expect that too — or are at least preparing for it, as they should be. I got a call the day after the CADA Summit inviting me to come and see a few vehicles that one Chinese manufacturer had brought to Toronto. The vehicles were at a Toronto dealership, giving select local dealers a chance to experience them firsthand.
My schedule didn’t allow it, but I’m sure I’ll have another chance. If they aren’t here still, they will certainly be back soon.
The USMCA review is starting to dominate the headlines. Not surprisingly, the Trump administration is going to some lengths to signal it wants to blow it up. They might just do that. And if Canadian-made vehicles can’t have tariff-free — or very nearly tariff-free — access to the U.S. market, the math in favour of Canadian vehicle assembly plants becomes difficult, or nearly impossible.
Industry Minister Mélanie Joly has said the federal government is working to land a Chinese-Canadian auto plant that would export electric vehicles globally. They are also in conversations with South Korean and German companies about tying automotive manufacturing to military and battery supply chain investments in Canada. I’ve spoken with a Chinese OEM who told me directly they are committed to establishing a manufacturing plant here.
But I don’t see how the math works.
The Canadian market isn’t big enough to justify building here solely for the domestic market. One possible exception might be full-size pickups. Canadians buy enough of those to support a shift in Oshawa and Oakville.
If the USMCA gets blown up, do we start to look a lot more like the Australian market? Once you lose domestic manufacturing, there’s no compelling reason not to truly open the market to Chinese brands and give consumers more choice.
It was great to speak with James Voortman at the Summit. The Australian dealer association head has a lot to share about his dealers’ experiences in a market that may well foreshadow where Canada is headed.
Two very positive notes stood out amid all of this.
First, the Canadian International AutoShow in Toronto welcomed approximately 374,000 visitors — a new attendance record. Canadian consumers want to see and experience new vehicles.
And finally, new research by Clarify Group examined whether AutoShow visitors who indicated last year that they intended to purchase actually followed through. Almost 80 per cent of those who said they would buy or lease a new vehicle did.
That’s a remarkable number.
So, amid all the uncertainty, it’s worth remembering that Canada remains one of the most important new vehicle markets in the world. That gives us some leverage. For dealers, it should continue to be a solid market this year and looking forward — no matter how the brand mix evolves. And evolve it will.
