Canadian car sales mixed in July, GM and Daimler up

TORONTO, Aug 1, 2003; Reuters reported that Canada's biggest car companies reported a 5 percent rise in July auto sales on Friday, rebounding from a sagging market the month before, but analysts warned the remainder of the year would likely be soft.

General Motors Corp., the country's biggest automaker, said combined sales of cars and light trucks increased 12.5 percent in July to 43,129 from 38,351 a year earlier.

The Oshawa, Ontario-based manufacturer said it sold 21,050 cars last month, up 6.1 percent from 19,838. Truck sales, which include sport utility vehicles and minivans, were up 19.3 percent at 22,0798 from 18,513.

DaimlerChrysler Canada said total July sales rose 6.9 percent to 17,630 from 16,495.

The Windsor, Ontario-based company said it sold 4,463 cars, up 11 percent from 4,017. Truck sales rose to 13,167 up 5.5 percent from 12,478.

Ford Motor Co. said combined July sales dropped to 22,321, down 4.3 percent from 23,336.

Oakville, Ontario-based Ford said it sold 15,724 trucks in July, up 4.4 percent from 15,059 last year. Car sales were 6,597, down 20.3 percent from 8,277.

Despite the higher July numbers, Dennis DesRosiers, an independent automotive analyst, expects to see about 1.6 million vehicles sold in Canada this year, down more than 5 percent from the 1.7 million sold last year.

Just last fall, DesRosiers forecast a dip of only 3 percent or 4 percent to 1.65 million vehicles.

"We just don't have the confidence that the sales are going to come in," DesRosiers said. "The consumer market is down."

Last year the carmakers cruised to an impressive year in Canada as attractive incentives, including no-interest financing, drew consumers into the showrooms.

Market share for the Big Three North American producers -- GM, Ford and DaimlerChrysler -- fell to a record low of 62.1 percent in the first half of 2003 from 63.4 percent a year earlier.

"Incentive costs at the Big Three have surged by 14 percent over the past year to roughly C$3,800 per vehicle," Carlos Gomes, Bank of Nova Scotia's auto industry specialist said in a report. "Inducements are now more than double the level of three years ago and show no sign of abating."

Toyota Canada Inc. (Tokyo:7203.T - News), the main Japanese-based rival to the Big Three, said it sold 14,384 vehicles in July, up 12.4 percent from last year.