Manufacturing Sales Slump 2.1% in April Amid Global Chip Shortage
Manufacturing sales in Canada suffered a decline in April, as the ongoing global semiconductor shortage significantly impacted the auto industry.
According to Statistics Canada, manufacturing sales fell 2.1% to $57.1 billion in April, as 11 of the 21 industries reported lower sales volumes, particularly for transportation equipment and petroleum and coal products. Excluding the transportation industry, manufacturing sales were actually up 1.5%, marking the eleventh month of gains. In constant dollar terms, sales fell 3.3% to $49.1 billion, suggesting a reduced volume of goods sold. Likewise, the Industrial Product Price Index rose 1.6% as prices of raw materials jumped 1%.
Canadian motor vehicle sales slumped 36.5% to $2.3 billion, marking the largest monthly decline since April 2020. The effects of the global chip shortage worsened in April, forcing nearly all auto manufacturers to temporarily reduce or halt production. Similarly, sales of motor vehicle parts were down 19% to $1.9 billion, the lowest since May of last year.
Sales of petroleum and coal products fell 7.1% to $5.1 billion, as some refineries underwent scheduled maintenance shutdowns. Despite the downturn, year-over-year sales surged 160.7% from the nadir of April 2020. Conversely, machinery sales soared to the highest on record, rising by 14.6% to $3.7 billion, while wood product sales jumped 6.5% to a new record-high of $4.9 billion, largely as a result of elevated prices.
Information for this briefing was found via Statistics Canada. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
