As the coronavirus pandemic brought many sectors of Canada’s economy to a screeching halt in the spring, it appears that many have been faring quite well on the road to recovery, including the auto sales industry.
According to latest data released by Statistics Canada, new vehicle sales increased by 36.5% in June, marking the second consecutive increase since vehicle sales plummeted back in March. In fact, the latest data shows that June’s levels are 18% above the pre-pandemic levels of February, suggesting that the rebound in the auto market is well underway.
When the Canadian government imposed stringent restrictions aimed at curbing the spread of the virus in March, many dealerships were forced to shut their doors and resort to online sales. In the meantime, many consumers opted to stay home and refrain from making large purchases for the time being. As a result, between March and April new vehicle sales fell by more than 50%, causing many dealerships to introducing a variety of sales tactics to get consumers buying new vehicles once again.
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However, as many restrictions were being lifted across the country, the pent-up demand became evident; sales numbers increased by 31% in May compared to the month prior, followed by yet another positive increase of 39,906 units in June. The month of June saw new vehicle sales nearly reach $6.6 billion – the highest since the beginning of the year.
Information for this briefing was found via the Wall Street Journal and CNN. 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.
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