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JAMA Canada Annual Review 1999

Overview of the Canadian Auto Industry - 1998

In 1998, the auto industry in Canada maintained its position as the sixth largest auto producing country with almost 2.57 million vehicles built, and as the ninth largest market with total sales/registrations of 1.42 million units.

Production: Passenger car output in Canada in 1998 rose 7.9% to 1.48 million units, but this was offset by a 9.2% drop in production of trucks to 1.09 million units, including medium and heavy-duty trucks, over the previous year. Labour disputes in the US in 1998 disrupted several plants in Canada, thereby reducing output. Overall however, production was almost unchanged from 1997, down less than 0.1%.

Shipments: Shipments of all automotive products totalled C$89.9 billion in 1998, up 6.2% from C$84.7 billion the year before, establishing a new record for the industry. According to Statistics Canada, motor vehicle manufacturers' shipments reached a total of C$59.6 billion, a gain of 5.4% from C$56.6 billion in 1997; and auto parts and accessories manufacturers' shipments grew 7.1% to C$27.7 billion from the previous year.

Employment: Annual average employment in all segments of the auto industry in Canada during 1998 rose 3.3% to 536,502 from 519,577 in 1997 according to Statistics Canada survey data. Motor vehicle assembly employment increased by 4.5% to 53,638, while auto parts and accessories manufacturers jumped 8.3% to 99,854 during the year. Reflecting the robust market in 1998, employment at dealers and distributors climbed 3.9% to 142,980 on average.

Sales: Motor vehicle sales in Canada reached a plateau in 1998, remaining only slightly ahead of 1997. Total sales of light, medium and heavy duty vehicles edged upward 0.6% to 1,427,983 units from 1,419,154 in the previous year.

Light vehicle sales rose marginally 0.1% to 1,389,099 from 1,387,922 in 1997. Passenger car sales squeezed ahead 0.3% to 740,815 units, while light trucks dipped slightly, down 0.2% to 648,284 units in1998. Car sales represented 53.3% of the light duty market, while trucks took 46.7% - only a minor change from 1997.

Trade: According to trade data from Statistics Canada, in 1998 Canada's external trade in automotive products with all countries, both exports and imports, totalled C$144.3 billion, up 11.3% from C$129.7 billion in 1997.

Total automotive exports to all countries surged 12.2% to C$77.6 billion from C$69.2 billion in the previous year. Exports of finished vehicles rose 12.1% to C$57.7 billion, while auto parts exports gained 12.5% to almost C$20.0 billion.

Automotive imports were also higher in 1998, up 10.3% overall from C$60.4 billion in 1997 to C$66.6 billion in 1998. Assembled vehicles accounted for C$27.3 billion, up 4.1% in terms of value; while auto parts imports were ahead 15.0% from the previous year at C$39.4 billion.

In terms of trade balances, Canada's automotive trade surplus bounced back in 1998 to C$11.0 billion overall, an increase of 25.5% from C$8.7 billion in 1997. The surplus in assembled vehicles jumped 20.5% to C$30.4 billion, overcoming the increase in the deficit of auto parts which grew 17.8% from C$16.4 billion in 1997 to C$19.4 billion in 1998.

An overwhelming majority of Canada's automotive exports, about 97.8% by value in 1998, go to the United States where the market continued to be strong. Exports to the US rose 13.6% overall, with assembled vehicles up 12.5% and auto parts exports ahead strongly 16.7% over 1997. Exports to Japan dropped 23.8% in value to C$105 million in 1998. Both finished vehicles and auto parts shipments declined largely due to the economic recession and sluggish auto markets in Japan during the year.

Automotive imports into Canada were also dominated by the US in 1998. US imports expanded 11.0% to C$55.8 billion, representing 83.7% of all auto related imports. Parts imports from the US accelerated ahead 15.7% to C$34.7 billion, while finished vehicles gained 3.9% for a total value of C$21.1 billion. Imports of automotive products from Japan were up 4.9% in value to C$4.3 billion from C$4.1 billion in 1997. Imports of finished vehicles were up 6.9% to C$2.9 billion, while auto parts almost unchanged, up 0.9% to C$1.4 billion compared to the previous year.


 

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