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New vehicle sales still down

New vehicle sales still down

Posted on: 7/16/2019 | Author: ATB Financial's Economics + Research Team

It turns out that “new car smell” is largely due to new vinyl and plastic giving off volatile organic compounds. Fewer Albertans have been inhaling these fumes with new vehicle sales in the province down for the 12th straight month in May.

Using a 12-month rolling average to account for seasonal variations, monthly new vehicle sales were down by 0.9 per cent in May after contracting by 0.5 per cent in April. On a year-over-year basis, sales in May were off by 8.1 per cent. Nationally, year-over-year sales fell by 6.5 per cent.

New vehicle sales are yet to catch-up to where they were before the downturn. The number of new cars and trucks sold in Alberta was 15.0 per cent lower in May 2019 than in May 2014 before the recession took hold.

The total value of new vehicles sold in May was also down. Sales in May 2019 totalled $1.05 billion compared t0 $1.15 billion the previous May for a drop of 9.2 per cent.

Passenger car sales were down more than truck sales (the truck category includes minivans, sport-utility vehicles, light and heavy trucks, vans and buses). The number of passenger cars sold in May 2019 was down 17.9 per cent compared to the previous May while the number of trucks sold was off by 5.9 per cent.

There were about 5.2 minivans, sport-utility vehicles, light and heavy trucks, vans and buses sold for every passenger car sold in May.

New vehicle sales are only a rough gauge of economic performance but they do give us a sense of the overall state of an economy. While not in recession, the Alberta economy is barely growing and this is reflected in the downward trend in new vehicles sales over the last year.

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