Automotive News Canada - March 2023 - 9

* MARCH 2023
9
2023 sales forecast: Let the (slow) upswing begin
The industry is not out
of the woods, however,
as supply constraints
are expected to linger
for 'several months'
By GREG LAYSON
DIGITAL AND MOBILE EDITOR
INVENTORY AND SEMICONDUCTOR
shortages continue to hamper new-vehicle
sales - and will do so for some time - but
2023 could signal a return to pre-pandemic
production levels, say industry analysts.
February sales were up an estimated
five per cent over the same month in
2022, although it was the second worst
February sales performance of the last
10 years, said DesRosiers Automotive
Consultants (DAC).
There was a wide chasm between automakers
still reporting monthly.
Honda Canada posted a 37-per-cent
drop in sales - including both Honda and
Acura brand sales - compared with the
same month a year ago. On the opposite
end of the spectrum, Kia sales climbed 32
per cent.
Neither automaker gave reasons for the
significant swings.
Despite historically low sales in
February, " the market has now achieved
year-over-year gains in four straight
months as the breadth of improved vehicle
availability gradually widens, and consumer
spending remains resilient, " DAC
Trim: 10.875 " x 7.375 "
Bleed: 11.125 " x 7.625 "
Safety: 10.25 " x 7 "
Managing Partner Andrew King said in a
statement.
The seasonally adjusted annual
rate of sales for the month is 1.7
million vehicles, which King said
is " broadly in line with the level
seen in January. "
LONG RECOVERY
demand, that we can get. "
Sam Fiorani, vice-president
of global forecasting at U.S.-based
AutoForecast Solutions (AFS), said those
automakers who were best prepared for
the global semiconductor shortage are outproducing
- and outperforming - those
that assumed the shortage
would pass quickly.
In his March report,
Fiorani said this year " is
expected to begin the long
recovery to full production
and 'normal' sales
levels. "
Scotiabank Lighthouse, 100 Yonge St., 5th
File: 2213350 - CBB - AutoxSWI Print ad
Carmichael:
" There's lots
of promise
that things
are going to
get better,
but we
haven't
seen it yet. "
FILE PHOTO
Colours: CMYK
Floor, Toronto ON, M5C 2W1
Michael Carmichael,
CEO of southwestern
Ontario-based group
UpAuto, isn't so sure.
" There's lots of promise
that things are going
to get better, but we haven't
seen it yet, " said
Carmichael, whose dealerships
sell General
Motors, Nissan, Honda,
Volkswagen and Subaru
brands in the Stratford area 150 kilometres
west of Toronto.
FEBRUARY
SALES
ANALYSIS
STATS/P30
A customer at a recently acquired
Volkswagen store has been
waiting for a Golf R ordered in
September 2021. Another is waiting
for one ordered in March 2022.
" It's like, 'Where are we at on
these'? " Carmichael said. " But [the
customers] haven't complained to
us. Like so many things, 'yeah, I
have to wait six months, a year.' "
SALES MOMENTUM
Despite the bottlenecks, Fiorani said
automakers are still on pace to sell 1.64
million new vehicles in Canada this year,
up from 1.5 million in 2022, but still below
the 1.66 million in 2021.
AFS projects that automakers in
Canada, the United States and Mexico will
collectively cut about 1.1 million vehicles
by the end of the year because of the
microchip shortage. That's an improvement
over the estimated 3.2 million in
2021 and the 1.6 million in 2022.
Globally, AFS expects automakers to
produce 2.8 million fewer vehicles in 2023
because of the shortage of chips.
Scotiabank Economics agrees that
automakers are heading toward more
normal production volumes, but it will
take some time.
Workfront#: 2213350
" We still can't fill all our orders. It's
across brands. The stuff that isn't in high
In Market: March 23, 2022
Deadline: March 21, 2022
Designer: Fabio Prod:
" The prolonged recovery in North
American auto production stagnated in
the second half of 2022 and automakers
expect slow production to linger in the
upcoming months, " the financial institution
said in its most recent Global Auto
Report.
" Though facing strong headwinds,
the demand side factors remain relatively
solid as incoming data suggests greater
economic resilience, " Scotiabank said.
" Economic conditions have proven more
resilient than anticipated, particularly
reflected in tight labour markets, where
strong employment growth and still-high
job vacancies support greater job stability
and provide a buffer in the case of a downturn. "
HIGHER
SALES TARGETS
Global Automakers of Canada CEO
David Adams, who represents the interests
of overseas brands in Canada, called
January and February " two positive
months to start off 2023. "
He said that almost 87 per cent of all
new vehicles sold were light trucks. That's
up a percentage point from the previous
month.
UpAuto's Carmichael said despite current
inventory shortages, automakers are
giving him increased monthly and annual
sales targets in 2023 compared with a year
ago.
He called one automaker's new goals a
" huge lift " and said some of the numbers
have gone up " dramatically. "
The numbers look good on the surface,
he said, and seem to forecast a robust sales
year, but it was difficult to reach some of
those new, higher numbers in February.
" I've got the vehicles sold, but I don't
have the inventory, " Carmichael said.
" So, ask me [at the end of the year] about
how I feel about January and February
inventory. " - ANC
We're paving the way
for women in the
auto industry.
The Scotiabank Women Initiative®
is a signature program
designed to increase economic opportunity for women-led
businesses now, and in the future. This unique offering helps
women pursue their best professional and financial futures
with access to capital and tailored solutions, specialized
education, and mentorship and advice.
To access our resources and tools, visit the Digital Hub at
scotiabankwomeninitiative.com/digitalhub
Participation in The Scotiabank Women Initiative®
or any program-related event does not constitute advice or an offer or commitment by Scotiabank to provide any financial products or services. ®
Registered trademark of The Bank of Nova Scotia, used under license.

http://www.scotiabankwomeninitiative.com/digitalhub

Automotive News Canada - March 2023

Table of Contents for the Digital Edition of Automotive News Canada - March 2023