• Facing COVID-19, Canadian Car Sales Tumble in Q1

Facing COVID-19, Canadian Car Sales Tumble in Q1

The sales departments of some dealers remain open by appointment only, while others have shuttered their doors for now.

Matthew Guy By: Matthew Guy April 2, 2020

Leaning into the headwinds of a global pandemic and a general populace largely staying at home to help curb the spread of COVID-19, automobile sales in Canada fell off a proverbial cliff during the first quarter of 2020.

It must be noted that many car makers have pivoted their production facilities to the manufacture of medical equipment, a move that will help those in the healthcare field. It will also likely induce product shortages down the road but, given the scale of response needed to quell the surge of this pandemic, the latter is hardly of a concern right now. Companies are helping in other ways as well, such as at GM where the company enabled OnStar Crisis Assist services for all connected-vehicle owners, as well as 3GB or three months of complimentary in-vehicle data – whichever comes first – for all Wi-Fi-equipped vehicles.

The sales departments of some dealers remain open by appointment only, affecting dealer traffic, while others have shuttered their doors for now. “We want to thank the dealers who have been able to remain open during these difficult times in order to ensure that all Canadians’ transportation needs are met, especially our nation’s first responders and health professionals,” said FCA Canada President and CEO, Dave Buckingham.

Dean Stoneley, president and CEO, Ford Motor Company of Canada, Ltd., chimed in by saying “Many of our dealership service bays are still operating to ensure police and other first responders, healthcare practitioners, and those providing food, medical supplies and other essential goods and services can continue to operate.”

Most manufacturers report their sales numbers on a quarterly basis, leaving us to estimate the extent to which sales crated in the month of March after what was generally considered a reasonably robust January and February. Various talking heads estimate sales fell by as much as half last month. This aligns with March numbers shown by Hyundai, one of the few companies who still provide monthly transparency, where sales were off by 44 percent to 5956 units.

Canadian Car Sales Tumble

In terms of quarterly performance, nearly every brand was off by double digits. Fiat Chrysler sank to 44,200 sales from 54,477 during this same time last year. Two takeaways worth noting in the chart shown here are the numbers from the Ram and Fiat divisions. The truck brand sank only 0.7% in Q1, indicating they must have been on a major tear in January and February. Fiat, meanwhile, averaged just over 20 cars a month this quarter and fewer than 30 cars a month during sunnier times during the same period last year, placing its volume in the basement of all manufacturers doing business in this country including boutique brands like McLaren. Surely this lack of volume cannot be sustained long term.

GM’s sales fell by about 13 percent in this year’s first quarter, moving 48,201 vehicles. A total of 15,768, or 32.7 percent of those were fleet sales. As a percentage, Cadillac was hit the hardest during this time, lending credence that luxury automakers may be harder hit than some mainstream brands. Sales at GMC were down 3.9 percent in Q1, indicating Canadians were snapping up trucks and SUVs apace until the economy ground to a halt.

Full numbers from all brands won’t be available again until the beginning of July, when Q2 results are reported. Depending how long social distancing and other defenses against COVID-19 last, one can only imagine what those results will look like. Stay safe, everyone.