Economist cites economic growth as a contributing factor
New vehicles are seen on a dealership lot in Mount Pearl Wednesday. According to the Canadian Automobile Dealers Association figures, this province is a top performer so far this year in new car sales. — Photo by Gary Hebbard/The Telegram
Through the first eight months of this year, auto sales in Newfoundland and Labrador are on the rise in comparison to 2011.
According to the latest figures compiled by DesRosiers Automotive Consultants, 23,790 vehicles were sold in the province by the end of August, an 11.6 per cent increase over sales through the first eight months of 2011.
As a percentage change over 2011, it is the best result in the country, tied with British Columbia. The national average is 6.7 per cent. Overall, 1.16 million vehicles were sold in Canada from January 2012 through to the end of last month.
“It’s really being driven by a lot of factors, obviously,” said Michael Hatch, chief economist for the Canadian Automobile Dealers Association. He is in St. John’s for the association’s annual general meeting.
“Super solid, general economic growth in this province. You guys are leading the country in a lot of indicators. Also record low affordability. Prices really haven’t been lower in the last 25 years. That, with the product mix that’s out there, is really what’s been driving a super strong year so far.”
Hatch said Newfoundland and Labrador is known for being a particularly robust market for large truck sales.
“People are buying what they need for their family, for their lifestyle, and their budget ... and again, the product mix is allowing them to do that.”
Looking towards sales for the final four months of 2012, Hatch expects they will continue to trend above 2011 figures, noting the fall is generally a solid season for sales given 2013 models will soon be launched.
“That gets people excited (and) gets them in showrooms. So we’re expecting demand to be strong for the rest of the year. Whether or not we can keep up 11 per cent for the province, that’s going to be tough honestly, because it’s a really difficult level to sustain over a long period of time.”
For August alone, vehicle sales in Newfoundland and Labrador were up by 15.5 per cent over the same month last year, also representing the highest percentage change in the country. Sales in July for the province were 4.7 per cent above the same month in 2011.