Canadian auto sales hit record highs in 2016 because of consumer demand for pickups and SUVs, despite ending the year on a weaker note that could continue this year, analysts said on Wednesday, citing automakers' data.
Automakers sold around 1.95 million units in Canada last year, up about 3 percent from another record year, 2015, auto analyst Dennis DesRosiers and Scotiabank Senior Economist Carlos Gomes wrote in notes to clients on Wednesday afternoon.
Continue Reading Below
December sales in Canada declined around 3 percent on an annual basis because of weaker demand for cars, they wrote.
But after three years of increasing Canadian auto sales, Gomes does not expect another record in 2017 as manufacturers raise prices due to the comparative weakness of the Canadian dollar, which closed today at $1.3308, or 75.14 U.S. cents.
"Purchases have consistently climbed to new annual records since 2013, but are likely to trend lower over the coming year, pressured by some deterioration in vehicle affordability," Gomes wrote.
Ford Motor Co , the top seller in Canada, said 2016 was its best year for Canadian sales since 1989, largely because of demand for its F-Series pickups. The automaker said in a statement it sold 304,618 vehicles in Canada in 2016, up 9.4 percent in 2015.
General Motors Co delivered 267,341 vehicles in 2016, up 1.5 percent from the previous year, while Fiat Chrysler Automobiles reported a 4 percent decline in sales last year from 2015.
Toyota Motor Corp <7203.T> said its Canadian sales rose 4.2 percent in 2016 to 217,792 vehicles, driven by higher sales of trucks, along with luxury and hybrid cars. 7203.T>
Analysts had said they expected auto manufacturers overall would set another Canadian market record in 2016, with sales rising to around 1.96 million vehicles from 1.90 million units in 2015.
In December, Canadian auto sales declined 2.6 percent, on an annual basis, to 125,600 units, DesRosiers wrote.
"December sales have been on a downward trend in recent years and it was no different in 2016," he wrote.
In the United States, sales of new cars and trucks likely set new records for December and the full year, automakers said on Wednesday, and investors bid up shares in the sector as strong consumer confidence and stable fuel prices bolstered the industry's outlook.
(Reporting by Allison Lampert; Editing by Tom Brown and Alan Crosby)