Canadian new-vehicle sales in January tumbled off a cliff for the majority of automakers still reporting monthly figures.
Hyundai-Kia Automotive sales, which also include the Genesis luxury brand, plunged 19.2 per cent in January.
On their own, Kia sales fell 16.9 per cent, in stark contrast to what was a stellar year for the brand. Kia in 2020 posted eight months of record sales (January, February, June, July, August, September, October and December). Kia brand sales totalled 3,360 in January 2021.
Hyundai is off to an even worse start, with sales down 22.2 per cent to 5,577 over the same month a year ago.
Toyota, the world's No. 1 automaker by volume in 2020, posted Canadian sales of 11,833, down 13.6 per cent. It’s luxury Lexus brand saw sales plummet 26.3 per cent, down to 1,220.
Subaru sales plunged 20.1 per cent in January, down to 2,653.
Rebekah Young, Scotiabank’s director, fiscal and provincial economics, says the market is seeing a “modest dampening” caused by pandemic lockdowns with “the majority of the country under strict measures for the month.”
Still, she remains optimistic, saying there was one fewer selling day in January 2021.
“I don’t think the final numbers will be particularly alarming nor surprising,” she said. “Even though dealerships were open by appointment, we know from the first wave that many still opt to wait before making this purchase so we expect that sort of dampening to strengthen auto sales in later months.”
She also said dealers continued to be dogged by inventory shortages, which won’t likely improve any time soon.
“Many dealerships started the year off with low inventory, given the pandemic-production catch-up lagging the [late] strong sales rebound,” she said. “Now, the chip shortage only exacerbates this temporary imbalance.”
Young said there is reason for hope in 2021 because economic data both on the Canadian and American side show “a stronger than expected handoff from 2020 to 2021.”
“That should bode well for auto sales this year,” she said.
Not every automaker sustained losses in January. Mazda saw its sales rise 7.6 per cent to 4,039 while Volvo managed a small 1.1-per-cent gain to 539.