Global car sales were strong in August: Scotiabank
In contrast, passenger vehicle sales in North America weakened in August, with lower volumes in both Canada and the U.S.
Helped along by strong consumer spending, global car sales remained in the fast lane through the summer, advancing 8% year-over-year (y/y) in August and lifting the year-to-date advance to nearly 6% – the strongest gain in three years.
According to a new report from Scotiabank, the improvement – which the bank called “stronger than expected” – was driven by a 20% y/y surge across Asia last month, the best performance since January 2013, as well as by continued strong gains in Western Europe.
“China has been the key driver of the acceleration in car sales across Asia this year, but purchases have also picked up through the rest of the region,” Scotiabank’s latest Auto News Flash said. “Excluding China, car sales in Asia climbed 4.4% y/y in August, double the advance through July. The improvement reflects some pickup in economic activity, especially in the key high-tech sector which lifted Taiwan’s export orders at a double-digit pace for the first time since early 2015.” Vehicle purchases have also steadied in South America, Scotiabank said, with the decline moderating significantly in recent months. “While Brazil continues to post double-digit declines, last month’s decrease was the smallest since March 2015,” the report said. “Excluding Brazil, car sales in South America have actually advanced in seven of the past eight months – a sharp reversal from the large and persistent fall-off through the end of last year.”
In contrast, passenger vehicle sales in North America weakened in August, with lower volumes in both Canada and the U.S. “We expect the U.S. soft patch to be temporary, as purchases are likely to pick up as economic activity gains momentum in the second half of 2016,” Scotiabank said. “In fact, preliminary data for September point to a rebound in U.S. purchases above an annualized 17.5 million units, up from only 16.9 million in August and a year-to-date average of 17.2 million.” Volumes in Canada, meanwhile, remained below an annualized 1.9 million units in August, the second consecutive month that sales were below the full-year 2015 average. “However, activity has been distorted over the summer by large declines at one manufacturer, and volumes continue to move higher for the rest of the industry,” the report said.