Weak early-year auto sales in China, while Europe rebounds: Scotiabank
Sales in Canada continued to decline in February, a new report by Scotiabank said, marking the twelfth year-on-year decline in a row off record February sales a year prior.
Global automotive sales fell again in February by 6.2% year-over-year (y/y), a new report from Scotiabank says, while Canadian auto deliveries continued to fall from same-month all-time highs in 2018 and may have been depressed by colder than usual weather in Ontario and Quebec.
Sales in Canada declined by 3.7% y/y in February, Scotiabank’s latest Global Auto Report said, marking the twelfth year-on-year decline in a row off record February sales a year prior. “Nevertheless, last month strung the first back-to-back month-on-month rise in purchases since October 2017, with a 2.6% month-over-month rise to 1.96 million units sold on a seasonally-adjusted annualised rate basis,” the report said. “We forecast that vehicle sales in Canada will fall to 1.93 million units this year from 2018’s sales total of 1.98 million units and 2017’s all-time high of 2.04 million units sold.”
Canadian truck sales edged higher by 1.2% y/y in February after three straight months of y/y losses, Scotiabank said, while car deliveries posted their steepest drop since the financial crisis at 15.9% y/y.
In the U.S., meanwhile, auto sales fell for a second consecutive month in both year-on-year (-2.8%) and month-on-month (-0.9%) terms to a seasonally-adjusted annualised rate of 16.53 million units delivered in February. “Last month’s decline follows weak figures in January as sales readjust from Q4-2018’s strong close to the year when purchases averaged 17.5 million units compared to the January–February average of 16.6 million units sold,” Scotiabank said. “Harsh weather in the Midwest and East Coast regions and the partial federal government shutdown may also have impacted sales in early-2019. We forecast that sales will make up lost ground through the remainder of the year to total 16.8 million units delivered in 2019, down from last year’s 17.2 million units.”
Year-on-year declines in vehicle purchases in Mexico resumed in February with a 5.3% y/y drop following a rise of 1.9% y/y in January owing to a one-off change in reporting of sales by General Motors,” the report said. “Outside of January’s increase, Mexican year-on-year auto sales growth has been in the red since June 2017 amid high interest rates and sluggish economic growth, which we anticipate will continue to depress sales through 2019,” Scotiabank said.
Chinese auto sales sharply contracted again in year-on-year terms in February with a 17.4% drop following January’s 17.7% decline, the report said.
Vehicle purchases in Western Europe appear to be on an improving trajectory following a spike and crash in auto sales prior to, and following, the introduction of new emissions testing standards in the European Union in September 2018, the report also noted.
“And sales activity in South America continues to be supported by strong gains in Brazil – where purchases rose by 25% y/y in February – while another steep drop in Argentina (-59% y/y) and a weak start to the year in Chile, Peru, and Colombia – down 5.1% y/y and 0.2% y/y, and up 0.6% y/y, in that order – contributed to a region-wide fall in sales of 2.3% y/y in February,” Scotiabank said.