The year began and ended with the Canadian auto industry still in the grips of the COVID-19 pandemic. From plant shutdowns and microchip shortages, to soaring used-car prices and consumers hoarding cash, the virus continued to dominate headlines. As the year went on, however, slivers of optimism began to poke out from under the doom and gloom.
Canadian auto parts makers say COVID-19 border restrictions are costing millions of dollars in lost business as key staff continues to face challenges meeting with customers and suppliers in the United States ... Economists say Canadians are sitting on cash — money they have been unable or unwilling to spend during the pandemic — and are expecting a flood of newcar sales in the spring … Auto shows across the country cancel, in some cases for a second straight year, forcing automakers, dealers and other businesses that would otherwise attend the Toronto, Montreal and Vancouver auto shows to find new ways to connect with consumers.
Of the many impacts of COVID19, a shortage of integrated circuits — the brains behind many new-car features — is forcing automakers to idle plants and stockpile nearly finished vehicles that cannot be sold. There appears to be no solution as new-vehicle inventory is stressed ... Despite that, dealers say that while sales are down, profits are higher ... Unifor, the union representing workers at the Detroit Three automakers in Canada, celebrates as General Motors announces a $1-billion investment in its CAMI assembly plant in Ingersoll, Ont., to build electric vans under its new BrightDrop brand. The plant builds the Chevrolet Equinox utility vehicle, but up to now there have been no future products assigned to the plant, casting doubt on its future.
The shortage of new vehicles means that desperate customers instead resort to buying used vehicles. In some cases, prices at auction for used vehicles are at or above the typical retail price, squeezing dealer profits. Dealers begin aggressively pursuing customers, encouraging them to sell their vehicles to put stock on the lot ... The spring selling season is expected to be in jeopardy as those microchip shortages hammer dealership inventories ... Meanwhile, experts say the pandemic is expected to unleash irreversible changes on the industry as customers demand new ways of doing business, from contactless service to online sales processes.