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Trade Policy

Commentary – Why the TPP will benefit the auto industry and consumers

November 25, 2015

David Worts – Contributed to The Globe and Mail

Published Tuesday, Nov. 24, 2015

Why is the Trans-Pacific Partnership important? Because it will restore a level playing field
among vehicle manufacturers that was lost as other free-trade deals extended benefits to
countries such as Mexico and South Korea. That competitive equity is important to vehicle
manufacturers, but it will also benefit Canadian consumers and has limited impact on Canadian
production facilities whose major market lies in the United States. Meanwhile, it provides
Canadian manufacturers with open access to 40 per cent of the global economy.

Much has been made by opponents of the deal of two provisions: the five-year tariff phase-out and the more flexible rules of origin. First, let’s examine the phase-out period.

The five years is actually longer than our companies felt was appropriate, given that Mexican
production already enters Canada duty free and that South Korean vehicles will achieve full
duty-free status at the end of next year. What’s more, tariff rates and structures differ between
the United States and Canada (in fact, Canada’s 6.1-per-cent tariff is 2 1/2 times higher than
the U.S. passenger vehicle tariff), so there’s no compelling reason why tariff phase-outs need to
be the same.

Given that adoption of the TPP by the partner countries will likely take at least two years,
followed by the five annual stage reductions of the tariff on imports from Japan, we will
continue to be placed at a competitive disadvantage for over half a decade. But we accept the
five-year phase-out as a far better outcome than the highly protectionist phase-out of U.S.
tariffs, which will delay the elimination of the 25-per-cent “chicken” tariff applied to pickup
truck imports in the United States for 30 years.

While critics of the deal focus on comparing Canada’s tariff phase-out period on vehicles to the
longer tariff cut schedule offered by the United States, they fail to acknowledge that the
important bilateral concession offered by the United States was the immediate elimination of U.S. duties on auto parts – something that will benefit American assembly plants as well as TPP parts makers. Canada already provides duty-free access to imported auto parts and it is interesting to note that Japanese investment in parts production in Canada has exponentially increased since these duties were eliminated in 1998.

In fact, if the past is any predictor of the future, it might be instructive to ask what has
happened to auto production in Canada since the original Canada-U.S. free-trade agreement was signed. South Korean and American auto makers have eliminated or reduced their Canadian footprint while Japanese companies have continued to invest here.

Secondly, the concerns about the TPP automotive rules of origin as compared to the North American free-trade agreement have been exaggerated and often misleading.

In spite of the fact that NAFTA sourcing is closer to 75 per cent (well above the 62.5-per-cent
NAFTA threshold) due to logistics and localization, it is worth noting that NAFTA doesn’t
guarantee any country-specific sourcing. That said, the auto parts industry in Canada does well
when vehicle plants in Canada are doing well.

Honda’s Alliston plant is now the global lead for the new Civic, and Toyota’s commitment for the next-generation Lexus RX and the second RAV-4 plant in Cambridge illustrate this reality.
What’s more, innovative, reliable and competitive Canadian suppliers will continue to benefit.
These supplier relationships in Canada have been forged over almost 30 years, and will not change just because the TPP rules differ from NAFTA.

Also noteworthy, the recent Automotive Parts Manufacturers’ Association-led “Connected Car”
project utilizing a vehicle built in Cambridge is a very encouraging demonstration of focused
collaboration and Canadian suppliers rising to global challenges with advanced technologies.

As with U.S. auto makers in Canada, Japanese auto makers are deeply integrated in the North
America auto sector. More than $10-billion has been invested in vehicle manufacturing over the
past 25 years, which has allowed Canada to be a net exporter of Japanese brand vehicles every
year since 1993.

In 2014, as a result of record production, we exported more than six times as many vehicles from Canada as were imported from Japan. Direct and indirect employment in our part of the auto industry stands at 72,600 across Canada, including about 30,500 in vehicle and Japanese-related auto parts plants, most of which are in Ontario.

At the same time, almost eight of every 10 Japanese brand vehicles sold in Canada are currently
made in North America, which means that about 20 per cent of sales are imported from Japan. But this 20 per cent represents about half of the various models that meet the wide-ranging needs of Canadian consumers. These include new or advanced technology models, or small-volume vehicles only manufactured in one plant globally.

Ultimately, consumers are the key beneficiaries from trade liberalization. Eliminating tariffs
reduces non-manufacturing costs, which allows auto makers to offer more choice, along with more features, better financing or lower prices.

No doubt, this is a challenging time in the automotive industry due to intensifying global competition, the advent of new and disruptive technologies, tougher safety and emissions regulations as well as the changing and ever-demanding needs and wants of consumers. From our perspective, the TPP represents a challenge and an opportunity with a long-term positive outlook that will benefit the auto industry and Canadian consumers.

 

Monthly Statistics

October 2015 sales

November 05, 2015

Robust light truck demand continued in October

New light vehicle sales in October increased 5.1% to 163,053 units, making it the best October on record. Continuing the trend, car sales fell 9.6% to 58,711 units, while light truck sales jumped 15.7% to 104,342 units.

Japanese automakers’ sales as a group rose 9.4% in October to 60,225 units. Sales of passenger cars continued to drop 11.2% to 25,630 units, while strong light truck sales totaled 34,595 units up 32.0%. Results among members were mixed in October: Nissan Canada was the growth leader with 24.2% sales gain followed by Subaru Canada (+11.7%), Honda Canada (+9.9%), Toyota Canada (+6.7%), Mazda Canada (+2.2%); while Mitsubishi Motor Sales Canada declined (-17.0%) compared to October 2014.

Jan-Oct YTD:

The overall Canadian market recorded positive growth up 2.7% to 1,624,185 units through the end of October. Light truck sales led the way as sales increased 8.6% to 999,096 units, while passenger car sales dipped 5.5% to 625,089 units. Light truck market share in Canada rose to 61.5% for the YTD.

Japanese brands YTD sales were up 5.1% to 561,652 units. Car sales were down 6.6% to 267,469 units, and light truck sales were up 18.7% to 294,183 units. JAMA Canada members’ share increased 0.8% to 34.6% for the YTD. Among member companies, Nissan Canada (+12.7%) and Subaru Canada (+11.7%) enjoyed a double digit sales gain.


Source: Global Automakers of Canada / JAMA Canada Members

 

Auto Industry in Canada

The Japanese Auto Industry in Canada – 2015 Facts & Figures pamphlet available

November 04, 2015

JAMA Canada has released the 2015 edition of "Facts & Figures" ("Faits & Chiffres" – en français). Both are now available on our website – http://www.jama.ca/industry/review/ 

Highlights of the Industry in 2014
: 

Sales in Canada – up 7.1% to 625,559 light vehicles – a new record


Production in Canada – up 6.4% to  972,418 light vehicles – a new record


Exports from Canadian plants – up 7.6% to 766,073 units – a new record
 
Imports –  up 10.4% to 379,144 units (imports from Japan down 25.6%; imports from NAFTA up 44.5%)
 

Canada has been a ‘net exporter’ of Japanese brand vehicles annually since 1993 – a current total net export of 3.6 million vehicles.

 

Monthly Statistics

September 2015 sales

October 07, 2015

A new record high month sales in September

Canadian light vehicle sales in September recorded 174,337 units up 3.7% from September 2014, which added another month on the record high stream – 7 consecutive months in total. Light truck sales jumped 10.4 % to 111,357 units, while car sales dropped 6.2% to 62,980 units.

All Japanese brands combined sales were up 8.7% in September to 61,723 units. Sales of passenger cars fell 2.7% to 28,602 units, while light truck sales remained steady, up 20.9% to 33, 121 units. The growth leader of this month was Honda Canada (+16.3%) followed by Subaru Canada (+11.2%), Nissan Canada (+9.7%), Toyota Canada (+5.5%), Mazda Canada (+4.7%), while Mitsubishi Motor Sales Canada sales dipped 13.3%.

Jan-Sep YTD:

Through the first three quarters of 2015, light vehicle sales in Canada were up 2.5% to 1.461 million units. While passenger car sales dropped 5.0% to 566,378 units, the strong demand for light truck sales remained positive up 7.8% to 894,754 units.

Japanese brands were up 4.6% YTD to 501,427 units driven by robust light truck sales up 17.2% to 259,588 units, while car sales lagged 6.1% to 241,839 units. In addition, sales of vehicle built in North America grew 11.7% to 391,731 units. Among member companies, Subaru Canada (+11.7%) and Nissan Canada (+11.5%) enjoyed the double digit sales increase. Japanese automakers total market share rose to 34.4% from 33.8% in 2014.


Source: Global Automakers of Canada / JAMA Canada members

 

Trade Policy

JAMA Canada Traité sur le PTP

October 06, 2015

Au nom des membres de JAMA Canada, nous aimerions féliciter chaleureusement monsieur le Ministre du Commerce international, l’honorable Ed Fast, ainsi que les négociateurs canadiens qui ont conclu avec succès le Partenariat transpacifique ou PTP. Une initiative complexe et délicate, cet accord commercial plurilatéral vise à libéraliser le commerce et à offrir des avantages à long terme pour tous les pays impliqués, notamment le Canada et le Japon.
 
Nous soutenons plus particulièrement les provisions automobiles du PTP concernant des règles d’origine flexibles et tournées vers l’avenir, car elles refléteraient les réalités des chaînes d’approvisionnement internationales actuelles. Nous sommes persuadés que cette flexibilité améliorerait la compétitivité de nos membres au Canada sans entraver la chaîne d’approvisionnement canadienne, bâtie sur près de 30 ans. En effet, la flexibilité des règles d’origine est absolument indispensable, puisque les constructeurs automobiles utilisent des chaînes d’approvisionnement internationales afin d’assurer la valeur de leurs produits.

Bien que nous espérions que les droits de douane seraient éliminés dès la mise en œuvre du PTP, ce qui l’aurait positionné sur un pied d’égalité avec les provisions douanières de l’accord de libre-échange entre le Canada et la Corée, nous accueillons avec enthousiasme le fait que le Canada ait prévu une élimination graduelle relativement rapide des droits de douane. Nous reconnaissons en particulier qu’il s’agit d’un résultat plus probant que la proposition des États-Unis, qui éliminera graduellement les droits de douane automobiles sur une période beaucoup plus longue. Cependant, cela reste logique, puisque les droits de douane automobiles des États-Unis ne sont pas les mêmes que ceux du Canada (en effet, les droits de douane de 6,1 % du Canada sur les véhicules particuliers sont deux fois et demie plus élevés que ceux des États-Unis). Il n’y a donc aucune raison à ce que les droits de douane canadiens suivent la même tendance que les droits de douane américains.

À l’instar des constructeurs américains installés au Canada, les constructeurs automobiles japonais sont fermement enracinés en Amérique du Nord. Depuis le milieu des années 80, ils ont investi globalement environ 10 milliards de dollars dans la fabrication de véhicules sur les marchés canadiens et nord-américains. En 2014, la production canadienne et l’exportation ont atteint de nouveaux records de 972 000 et 766 000 unités respectivement. Grâce à cette augmentation de la production, des exportations et des ventes canadiennes, l’emploi direct et indirect est également en hausse, dépassant maintenant 72 000 personnes dans l’ensemble du pays.

De plus, et ce, chaque année depuis 1992, le Canada est un exportateur net de véhicules de marque japonaise. En 2014, les exportations de véhicules de marques japonaises étaient six fois plus élevées que les importations en provenance du Japon. Actuellement, plus de 78 % des véhicules de marques japonaises vendus au Canada sont des véhicules fabriqués en Amérique du Nord. Les 22 % restants que nos membres importent du Japon leur permettent de répondre aux besoins diversifiés des consommateurs canadiens, surtout pour les constructeurs dont l’envergure n’est pas encore à l’échelle de la production de l’ALENA.

Enfin, nous sommes enthousiastes à l’idée de travailler étroitement avec le gouvernement canadien afin de conclure des accords commerciaux bilatéraux et régionaux avec le Japon. À notre avis, l’élimination graduelle rapide des droits de douane, ainsi que des règles d’origine fixées sur l’avenir sont indispensables au maintien d’un marché canadien équilibré et concurrentiel. Plus important encore, nous nous engageons à promouvoir une industrie automobile canadienne économiquement dynamique, écologiquement durable et compétitive à l’échelle internationale.

 

Trade Policy

JAMA Canada Statement on TPP

October 05, 2015

On behalf of the members of JAMA Canada, we would like to congratulate the Minister of International Trade, the Hon Ed Fast, and the Canadian trade negotiators for reaching a successful conclusion to the Trans Pacific Partnership or TPP. As a plurilateral trade agreement, the TPP was a complex and challenging initiative for trade liberalization that will have long term benefits for all member countries, including Canada and Japan.

With respect to the automotive provisions in the TPP, we support the provision of forward-looking, flexible rules of origin (ROO) which reflect the realities of current global supply chains. We believe this flexibility would enhance the competitiveness of our members in Canada and not distort our supply chain in Canada, which has been built up over almost 30 years. ROO flexibility is necessary since automakers rely on global value chains.

While we were hoping that auto tariffs would be eliminated on implementation, which would have ensured a level playing field with the Canada-Korea FTA tariff provisions, we are pleased that Canada was able to secure a relatively quick automotive tariff phase-out in the TPP. In particular, we acknowledge this is a better outcome compared to the longer phase-out of US auto tariffs. This makes sense given that auto tariffs between the US and Canada are not aligned (in fact Canada’s 6.1% tariff is two and a half times higher than the US passenger vehicle tariff), so there is no reason for Canada’s tariff phase-out to be aligned with the US.

Like US automakers in Canada, Japanese automakers are deeply integrated in North America. Since the mid-1980’s, Japanese automakers have invested about $10 billion cumulatively to manufacture vehicles in Canada for the North American market. In 2014, production in Canada set a new record of 972,000 vehicles, with a record export of 766,000 units. And with record production, exports and sales in Canada, direct and indirect employment is also on the rise – now in excess of 72,000 across Canada.

What’s more, every year since 1993, Canada has been a net exporter of Japanese brand vehicles. In 2014, Japanese brand exports were six times greater than total vehicle imports from Japan. Currently over 78% of Japanese brand auto sales in Canada are vehicles built in North America. The remaining 22% that our members import from Japan are critical to meeting the diversified transportation needs of Canadian consumers, particularly for smaller manufacturers that have not yet reached economies of scale in NAFTA production.

Finally, we look forward to working closely with the Canadian government to achieve both bilateral and regional trade agreements with Japan. In our view quick tariff phase-outs and forward looking rules of origin are vital to maintain a balanced and competitive market in Canada. Overall, we remain committed to a Canadian auto industry that is economically vibrant, environmentally sustainable and globally competitive.

 

Monthly Statistics

August 2015 sales

September 03, 2015

Continuing sales growth in August

New vehicle sales in Canada climbed up to another monthly record high of 175,512 units, an increase of 2.2 % compared to August 2014. While car sales declined 8.9% to 64,622 units, light truck sales extended robust demand with a 10.0% gain to 110,890 units.

Overall Japanese brand sales in August rose 3.1% to 59,889 units. Light truck sales among JAMA Canada members jumped 23.9% to 32,581 units, while car sales fell 14.1% to 27,308. Results among members were mixed in August: Honda Canada was the growth leader with 11.3% sales gain followed by Nissan Canada (+9.6%) compared to August last year. On the downside were Mitsubishi Canada (-0.9%), Toyota Canada (-1.1%), Mazda Canada (-6.0%), and Subaru Canada (-9.3%) over August 2014.

YTD Results (Jan-Aug)

The overall market in Canada has increased 2.3 % through the end of August to almost 1.29 million units. The surplus has been sustained by strong demand for light trucks. Car sales have dipped 4.9% to 503,398 units (a market share of 39.1%), while light truck sales were up 7.5% to 783,397 units.

As a group, Japanese automakers’ sales have grown 4.1% to 439,704 units for the YTD. Car sales were down 6.6% to 213,237 units, and light trucks sales were up 16.7% to 226,467 units. This result improved market share for JAMA Canada members to 34.2% from 33.6% in 2014. Among member companies, Subaru Canada (+11.8%), Nissan Canada (+11.7%), Toyota Canada (+3.2%), and Honda Canada (+2.6%) were in positive territory. All members’ light truck sales remained strong.



Source: Global Automakers of Canada / JAMA Canada members

 

Monthly Statistics

July 2015 sales

August 06, 2015

Setting a new July sales record

Light vehicle sales in Canada remained positive in July up 0.4 % to a record 177,844 units. Although car sales slipped 10.3% to 66,777 units, strong light truck sales continued to rise 8.2% to 111,067 units.

Sales of new Japanese brands totalled 61,607 units up 6.1% over July 2014. Car sales dropped 11.0 % to 28,430 units, while light truck sales increased 26.9 % to 33,177 units. Results among JAMA Canada member companies: in July the growth leaders were Subaru Canada (+12.6%), Honda Canada (+10.4%), and Nissan Canada (+9.9%) while others were generally lower however, all members’ truck sales remained strong.

YTD Results (Jan-Jul)

Through the end of July, sales in Canada have increased 2.3% overall to 1,111,283 units. Light trucks continuously lead with robust sales up 7.1% to 672,507 units representing 60.5% of the Canadian market for the YTD – while passenger car sales fell 4.2% to 438,776 units.

Japanese brand YTD sales were up 4.3% to 379,815 units on the strong light truck demand  as car sales dropped 5.4%, while truck sales jumped 15.5% compared to last year. JAMA Canada members’ market share was slightly up to 34.2% for the YTD. Moreover, 78.2% of members’ sales were vehicles built in North America, up from 72.1% in 2014.


Source: Global Automakers of Canada / JAMA Canada members

 

Monthly Statistics

June 2015 sales

July 08, 2015

Light truck sales strengthen in June

New light vehicle sales in June hit another all-time monthly sales record, up 1.2% overall to 177,857 units. Sales of light trucks rose 11.5% in June to 109,400 units, while passenger car sales fell 11.7% to 68,457 units.

Sales of Japanese brands rose 8.6% in June to 62,959 units on mixed results. Sales of passenger cars dropped 7.8% to 30,116 units, while light truck sales jumped 29.8% to 32,843 units. All members’ sales were positive in June and the growth leader was Subaru Canada (+22.5%), followed by Mitsubishi Motor Sales Canada (+11.7%), Nissan Canada (+10.7%), and Toyota Canada (+10.5%).

YTD Results (Jan-Jun)

At the end of the second quarter of 2015, light vehicle sales in Canada were up 2.7% to 933,439 units. Demand for light trucks continues to surpass passenger cars as truck sales grew 6.9% to 561,436 units, while 372,003 cars were sold in the first half, down 3.1% from 2014. Nearly 60% of all vehicles sold were light trucks in the YTD.

Japanese brands were up 3.9% YTD to 318,208 units, driven by strong truck sales, up 13.4% to 160,709 units, while car sales lagged 4.3% to 157,499 units. At the same time, sales of vehicles built in North America continued to rise 14.1% to 249,103 units representing 78.3% share of total member sales, up from 70.8% that were NA-built in 2014 YTD.

Results were mixed among member companies: Subaru Canada (+15.4%), Nissan Canada (+12.5%) and Toyota Canada (+4.3%) were all in positive territory; while Honda Canada (-0.5%), Mazda Canada (-3.7%) and Mitsubishi Motor Sales Canada (-6.9%) had softer sales compared to last year. Japanese market share was 34.1% in the first 2Qs of 2015, up marginally from 33.7% last year.


Source: Global Automakers of Canada / JAMA Canada members

 

Monthly Statistics

May 2015 sales

June 12, 2015

May sales higher on strong light truck demand

Light vehicle sales in Canada rose modestly in May, up 1.1% to a new monthly record of 197,937 units. Passenger car sales fell 1.1% to 83,597 units, while light truck sales gained 2.8% to 114,340 units.

Sales of Japanese brands improved 1.7% in May to 66,938 units on mixed results. Sales of passenger cars dropped 8.0% to 34,203 units, while light truck sales jumped 14.3% in May to 32,735 units.

Among member companies, the growth leader was Nissan Canada with a sales gain of 21.8% in May, followed by Subaru Canada up 12.6% and Mitsubishi Canada up 8.1% compared to sales in May 2014.

Jan-May YTD:

Through the end of May, sales in Canada were up 3.0% overall to 755,582 units. Light trucks again led the way as sales increased 5.8% to 452,036, while car sales softened, down 0.9% to 303,546 units. Light truck market share in Canada rose to just under 60.0% for the YTD.

Japanese brand YTD sales were up 2.8% to 255,249 units, although not enough to change market share at 33.8% compared to 2014. While car sales were down 3.4% to 127,383 units, combined sales of light trucks were up 9.9% to 127,866 units, slightly surpassing the YTD sales of passenger cars. In addition, sales of vehicles built in North America increased 14.0% YTD to 199,480 units which boosted the NA-built sales share to 78.1% at the end of May.

Among member companies, Subaru Canada (+13.9%), Nissan Canada (+12.9%) and Toyota Canada (+2.9%) are in positive territory through the first five months of 2015. While others were lower overall, most members have recorded gains in light truck sales in 2015 YTD.

Sales May – 2015

 


Source: Global Automakers of Canada / JAMA Canada members

 

Monthly Statistics

April 2015 sales

May 14, 2015

April sales up on light truck demand

Strong demand at the start of the key selling season pushed light vehicle sales in Canada up 5.7% to a record 189,072 units in April.  Deliveries of passenger cars rose 2.0% to 79,258 units, while light truck models gained 8.5% to 109,814 units in April.

All Japanese brands combined sales in April totaled 62,828 units, up 3.5% over April 2014. Car sales fell 1.3% to 32,240 units, while light truck sales rose 8.3% to 30,588 units.

Results among JAMA Canada members were mixed in April: Subaru Canada was the growth leader with a 17.1% sales gain, followed by Nissan Canada (+8.5%) and Honda Canada (+6.5%) compared to April last year. Toyota Canada sales were largely unchanged YOY, while Mazda Canada (-1.5%) and Mitsubishi Motor Sales Canada (-14.2%) reported lower monthly sales compared to 2014.

YTD Results (Jan-Apr)

Through the first four months of 2015, light vehicle sales in Canada have increased 3.7% to 557,645 units, almost 20,000 more than in 2014. Passenger car sales continued to soften, down 0.8% to 219,949 units (a 39.4% market share), while strong demand pushed truck sales up 6.9% to 337,696 units – and a 60.6% YTD share of the Canadian light vehicle market.

Japanese brand YTD sales improved 3.2% through the end of April to 188,311 units on the strength of light truck demand as car sales fell 1.6% while truck sales rose 8.4% compared to last year. For the YTD, JAMA Canada members’ market share was off slightly to 33.7%. The shift to more local sourcing in North America continues as 78.1% of members’ sales were vehicles built in N.A., up from 69.8% in 2014.

Sales April – 2015

 


Source: Global Automakers of Canada / JAMA Canada members

 

Monthly Statistics

March 2015 sales

April 13, 2015

March Sales Climb on Mixed Results:

New light vehicle sales in March made modest gains over last year, but managed to set a new sales record for the month, up 1.9% overall to 160,274 retail units. Sales of light trucks rose 5.4% in March to 95,952 units, while passenger car deliveries fell 2.9% to 64,322 units.

Japanese brand sales as a group were up slightly (+1.0%) in March to 55,516 units. Sales of passenger cars dropped 5.5% to 27,593 units, while light truck sales jumped 8.5% to 27,923 units.

However, results varied among JAMA Canada member companies: in March the growth leaders were Subaru Canada (+16.1%), Mazda Canada (+7.6%) and Nissan Canada (+6.8%); while others were generally lower, although truck sales remained robust.

YTD (Jan to Mar):

At the end of the first quarter of 2015, light vehicle sales in Canada were up 2.7% to 368,573 units. Demand for light trucks, particularly crossovers and compact SUVs, continues to outstrip passenger cars, as truck sales grew 6.1% to 227,882 units, while 140,030 cars were sold in the 1Q, down 2.3% from 2014. Nearly 62% of all vehicles sold YTD were light trucks.

Japanese brands were up 3.1% YTD to 125,483 units, driven by strong truck sales, up 8.0% to 64,543 units, while car sales lagged 1.7% to 60,940 units. At the same time, sales of vehicles built in North America jumped 15.1% to 97,649 units representing a 77.8% share of total member sales, up from 69.7% that were NA-built in the first quarter of 2014.

Results were mixed among member companies: Subaru Canada (+13.1%), Nissan Canada (+11.0%) and Toyota Canada (+6.6%) were all in positive territory; while Mazda Canada (-3.5%), Honda Canada (-3.8%) and Mitsubishi Motor Sales Canada (-16.1%) had softer sales compared to last year. Japanese market share was 34.0% in the 1Q of 2015, up marginally from 33.9% last year.

Sales March – 2015
Source: Global Automakers of Canada / JAMA Canada members

 

Monthly Statistics

February 2015 sales

March 09, 2015

February sales climb on mixed results

Light vehicle sales in Canada increased by 3.2 percent to 109,248 units across Canada, making it the second best February on record after 2008 (110,951 units). Market demand continues to favour light trucks as sales grew 5.1 percent while passenger car sales were only up 0.2 percent. 

Sales of Japanese brands in February rose 5.5% to 36,318 units, as passenger car and light truck deliveries increased 4.9% and 6.2% respectively. Notably, light trucks outsold cars again for the fourth consecutive month.

Results among JAMA Canada members were mixed in February: Toyota Canada led in both growth and volume as sales jumped 18.8% in February, followed by Nissan Canada with a sales gain of 16.4% and Subaru Canada up 8.2% in units sold. On the other hand, Honda Canada sales fell 5.6%, while Mazda Canada posted a drop of 10.8% in February, and Mitsubishi Motor Sales Canada sales declined 29.2% compared to February last year.

YTD 2015:

Overall, sales in Canada have improved by 3.3% YOY to 208,299 units through the end of February. Light truck sales were ahead 6.6% to 131,930 units, while car sales were off 1.9% to 76,369 units over 2014. Light trucks now account for a record 63.3 percent of the Canadian market.

Japanese brand sales were up 4.7% to 69,967 units for the YTD, with light trucks leading with a 7.7% gain, compared to just 1.6% for passenger cars. Also notable is the dramatic sales gain of vehicles built in North America, up 19.1% to 54,600 units, while imports from Japan continue to fall, down 26.8% to 15,367 units. Japanese market share stands at 33.6%, up slightly from 33.2% in 2014.


Sales February – 2015

 

Source: Global Automakers of Canada / JAMA Canada members

 

 

Trade Policy

JAMA Canada Calls for Level-Playing Field on Auto Tariffs

February 11, 2015

Strong 2014 performance shows continued demand for Japanese-brand vehicles

With the implementation of the Canada – Korea Free Trade Agreement last month, the Japan Automobile Manufacturers of Canada (JAMA Canada) continues to call for a trade agreement that would eliminate the 6.1 per cent import tariff imposed on imports from Japan, including some of the most environmentally friendly and technologically advanced vehicles available today.

In light of a record sales year for Japanese-brand vehicles in 2014 and the critical role JAMA Canada member companies play in the Canadian economy, it’s time to level the playing field with respect to import tariffs.

“Japanese automakers continue to play an extremely important role in the Canadian economy, with our strong 2014 performance once again demonstrating that Japanese-brand vehicles are in high demand in Canada,” said Jerry Chenkin, Chairman of JAMA Canada. Key 2014 sales, production and export performance figures are evidence of the very real benefits Japanese automakers create for Canadians every day:
  • Japanese light vehicle production in Canada hit a new peak in 2014 in excess of 972,000 units, representing 40.8 per cent share of total output by all automakers in Canada
  • Japanese vehicle exports from Canada also set a new record at 766,000 units, an export-to-production ratio of about 79 per cent
  • In 2014, almost 75 per cent of Japanese sales in Canada were models built locally in North America; moreover, over 42 per cent of NA-built sales were made in Canada

Canada has been a net exporter of Japanese-brand vehicles since 1993 with nearly four million net vehicle exports during that time. A big part of JAMA Canada’s positive trade performance is attributed to the North American Free Trade Agreement (NAFTA). While more than 766,000 Japanese-brand vehicles were exported from Canada last year primarily to the US, less than half of that (about 370,000 vehicles) were imported from all countries including the US, Mexico and Japan.

“Liberalized trade policies have played a significant role in the success that Japanese automakers have generated in Canada,” said David Worts, Executive Director of JAMA Canada. “Having seen what’s possible as a result of NAFTA, our members continue to fully support further trade liberalization including the Trans-Pacific Partnership and the Canada-Japan Economic Partnership Agreement.”

“Canada and Canadians reap huge benefits from our members’ presence here and that our vehicles are popular with Canadian consumers,” added Mr. Worts. “We look forward to concluding trade negotiations which will level the playing field for imports from Japan so that consumers have the best possible choices.”



 

Monthly Statistics

January 2015 sales

February 10, 2015

January sales up on light truck demand

New light vehicle sales in Canada increased 3.4% to 99,051 units in January over the first month last year. Continuing the trend, car sales fell 4.2% to 35,170 units, while light truck sales jumped 8.2% to 63,881 units.

Japanese automakers as a group slightly outperformed the market in January, with sales up 3.8% to 33,154 units altogether. Car sales fell 1.9% to 15,318 units, while light trucks rose 9.3% to 17,836 units reflecting the overall market trend toward light trucks, particularly crossovers and compact SUVs. The shift toward locally built vehicles continues with North American built models up 18.0% to 25,862 units, while imports from Japan fell 27.2% to 7,292 units.

Among individual members, Subaru Canada (+13.5%), Nissan Canada (+12.0%) and Toyota Canada (+10.4%) were all up with sales improvements in double digits. Overall market share for Japanese brands stood at 33.5%, up slightly from 33.3% in January 2014.
 

Sales – January 2015

Source: Global Automakers of Canada / JAMA Canada members

 
 

Monthly Statistics

December 2014 sales

January 09, 2015

New sales record in 2014

Light vehicle sales in Canada set a new record in December as total deliveries rose 16.1% to 131,393 units. Sales of passenger cars were up 10.7% to 48,002 units, while light trucks jumped 19.5% to 83,391 units.

Japanese brand sales in December rose a modest 3.6% to 42,938 units. Car sales slipped 1.5% to 19,595 units, while light trucks gained 8.4% to 23,343 units. Trucks outsold cars for the second month in a row. Among individual companies, Nissan Canada was the growth leader in December with a gain of 17.9% YOY, followed by Subaru Canada with monthly sales up 15.9% over last December. Members recording single digit growth included Mitsubishi Motor Sales Canada (+7.2%), Honda Canada (+3.8%) and Toyota Canada (+0.5%). Mazda Canada light truck sales gained 10.4% over December 2013.

2014 YTD:

The light vehicle market in Canada set a new record in 2014, rising 6.1% to 1.851 million units, up over 100,000 units from the previous record in 2013. Sales of passenger cars were flat (-0.1%) at 763,792 units, while light truck sales jumped 11.0% to 1,087,581 units. The truck share rose two and a half points to 58.7% in 2014.

Japanese brands combined sold a record 625,559 units, a gain of 7.1% over last year. The previous record was set in 2008 with sales of 615,924 units. Car sales improved 3.4% in 2014 to 329,898 units, while light truck sales rose 11.7% to 295,661 units. From another perspective, 74.6% of total Japanese sales in 2014 were models built in North America (71.4% of cars, and 78.3% of light trucks were NA built), up from 67.1% in 2013 (63.6% of cars, and 71.2% of light trucks were NA built). Japanese brand share in 2014 overall climbed to 33.8% from 33.5% last year.

While all JAMA Canada member companies’ sales were up over the previous year, four members set new sales records in 2014: Honda Canada (+5.0%) to 172,426 units; Nissan Canada (+26.1%) to 115,445 units; Subaru Canada (+14.3%) to 42,035 units and Mitsubishi Motor Sales Canada (+7.6%) to 22,704 units. The volume leader in 2014 was Toyota Canada (+2.8%) to 200,851 units. 

Sales – December 2014

Source: Global Automakers of Canada / JAMA Canada members

 

 

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