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Canadian vehicle sales up 6.3 per cent in July

A Jeep Grand Cherokee is seen in this image courtesy Chrysler Canada
A Jeep Grand Cherokee is seen in this image courtesy Chrysler Canada

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Date: Wednesday Aug. 4, 2010 5:36 PM ET

TORONTO — Massive restructurings at both General Motors and Chrysler appear to be paying off as the two automakers depended less on fleet sales and more on consumers to buy their vehicles in July.

Chrysler Canada said Wednesday that it sold 22,319 vehicles last month, up 40 per cent from a year ago when most of the big manufacturers were still struggling with the global recession.

By comparison, overall Canadian light vehicle sales were up 6.3 per cent to 148,756, according to data compiled by DesRosiers Automotive Consultants.

Perhaps most significantly, Chrysler's retail sales were up 50 per cent year over year. The North American automakers have been criticized in the past for relying too heavily on fleet sales, like car rental agencies and taxi services, to bolster their sales numbers.

"While fleet sales continue to be solid, our real strength has been in incredibly robust retail sales at our dealerships," stated Dave Buckingham, vice-president of sales at Chrysler Canada.

The story was similar at GM Canada, which said retail sales of the brands it didn't eliminate during its restructuring -- GMC, Cadillac, Chevrolet and Buick -- jumped 69 per cent from July 2009.

Overall, GM sold 23,917 vehicles last month, up 21 per cent from a year ago.

Bill Pochiluk, president of industry research firm AutomotiveCompass, pointed out that 2009 was an abysmal year for both companies so the increases have to be taken with a grain of salt. However, he said the results are still "quite remarkable."

"I think this is really showing pent-up demand and a re-emergence of the idea that these really are changed companies, these really are changed brands, we can have confidence in their products, and yes, they're going to be around tomorrow," Pochiluk said.

He added that an influx of new products from all the major automakers combined with attractive incentive programs is helping to draw consumers into showrooms, but cautioned that sales could slow down in the second half of 2010 as the economic recovery slows and consumer confidence wanes.

Both GM and Chrysler were forced to file for bankruptcy protection in the U.S. last year and have dramatically restructured their operations with the help of billions of dollars in government aid from the U.S., Canada and Ontario.

While Chrysler partnered with Italian automaker Fiat to give it access to the small-vehicle technology it lacked, GM has been going it alone with a renewed focus on the consumer and new vehicles, including the battery-powered Chevrolet Volt that will be launched later this year.

Ford Canada's sales edged higher in July, as strong car sales were hurt by a decline in the number of trucks purchased.

Ford said its overall sales inched up by two per cent to 27,203 last month, bumping the automaker to its best July since 1979. Overall sales were boosted by a 46 per cent increase in the number of cars sold, but this was offset by a nine per cent decline in truck sales.

Ford weathered the downturn much better than Chrysler and GM, as it was the only one of the so-called Detroit Three to avoid filing for bankruptcy protection.

Among the Japanese automakers, Honda Canada sales fell 11 per cent in July to 11,615 units from its Honda and Acura divisions combined.

Sales of Honda-branded vehicles were down 10 per cent at 10,184, while sales of the luxury Acura brand fell 13 per cent to 1,431 units.

Sales at Toyota Canada dropped 22.6 per cent to 14,882 from its Toyota and Lexus divisions combined. Toyota has been contending with slumping vehicle sales for the last four months amid ongoing safety concerns following massive global recalls of several of its brands.

Sales of Toyota-branded vehicles were down 22.8 per cent at 13,681, while sales of its luxury Lexus brand fell 20.6 per cent to 1,201. However, the automaker reported a 7.9 per cent increase in truck sales to 6,397.

South Korean automaker Hyundai reported that its Canadian sales rose 9.7 per cent to 11,503 units.

In terms of year-to-date market share, Ford took first place with 17.1 per cent of the market; GM was second with 15.7 per cent; Chrysler was third with 13.6 per cent; Toyota was fourth with 11.5 per cent; and Honda was fifth with 8.3 per cent.

Among other automakers, Nissan sold 7,525 vehicles in July, up 10.1 per cent, while its Infiniti luxury brand sold 793 vehicles, up 13 per cent.

Mercedes-Benz saw Canadian sales of 2,222, up 12.3 per cent, while BMW's sales fell 12.1 per cent to 2,107.

Volkswagen sold 3,881 vehicles in July, down 3.4 per cent, while Audi's sales rose 46 per cent to 1,200.

Kia sold 5,652 vehicles, up 10.6 per cent, while Mazda sales gained 12 per cent to 7,268, Mitsubishi sales were down 12 per cent to 1,672 and Subaru sold 2,336 vehicles, up 28.1 per cent.

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