Driving By Numbers: Province by province pandemic auto sales

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Fewer sick people, more car sales. With few exceptions, that seemed to be the rule when the summer and fall of 2020 brought about a significant increase in regional new vehicle sales across Canada.

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Following the economic meltdown and ensuing disappearance of vehicle sales through much of March, April, and May, most of the significant recoveries occurred in markets where COVID-19 never fully broke out.

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But before examining each province’s collapse and respective rate of recovery, it’s first worth asking: just how bad was it? How quickly did demand for new vehicles evaporate? When dealers locked showroom doors, when potential customers lost their jobs, and when consumer confidence crumbled – how long did the auto industry’s disastrous phase linger?

Despite a relatively normal first-half of March 2020, sales during the month in which COVID-19 broke loose in Canada still fell by nearly 50 per cent, year-over-year, according to Statistics Canada. Nationally, that equalled a loss of more than 90,000 sales, with the bulk of those losses occurring in the final two weeks of the month.

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April, however, revealed the true extent of the damage. Compared with April 2019, three-quarters of Canada’s April auto sales disappeared, a staggering loss of more than 138,000 sales. Roughly 63,000 of the lost sales occurred in Ontario and Quebec, two provinces typically home to two-thirds of the Canadian auto market. In April 2020, Ontario and Quebec generated less than half of Canada’s auto sales.

Yet by May, the worst was over. Compared with 2019, the auto industry continued to shed sales, but the rate of decline never again resembled April’s 75 per cent national drop. By the time the third-quarter rolled along, auto sales were limited as much (if not more) by supply limitations as decreased demand. In fact, by September of 2020 – only six months after COVID-19 was declared a pandemic – auto sales in Canada were stronger than they were in September 2019.

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The national auto industry’s COVID-19 sales timeline is nevertheless not representative of each province’s COVID collapse or recovery. With 2019 and 2020 monthly figures from Statistics Canada’s New Motor Vehicle Sales data set, here’s a province-by-province look at COVID-19’s impact in car dealerships over the last year.

Ontario

Four out of every 10 Canadian residents live in Ontario. With that kind of buying power, Ontario has the capacity to fuel the Canadian auto industry and the sheer force to bring a market down. Throughout much of 2020, worse-than-average Ontario sales results have constrained Canada’s recovery potential. Year-over-year, Ontario fell behind the national average in each of the last nine months of 2020. At 646,275 sales in 2020, Ontario finished the year down 23 per cent. In 2019, 43 percent of Canada’s auto sales occurred in Ontario. That figure dipped to 41 per cent as Ontario’s auto sales volume dropped by 197,000 units.

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Quebec

During the early part of the pandemic, no provincial auto market in Canada suffered declines as sharp as Quebec. April’s 85 percent decrease in Quebec auto sales was, for example, 29 percentage points worse than Saskatchewan’s. The severe nature of the decrease fuelled greater pent-up demand as spring turned to summer – Quebec sales in June 2020 were actually 9 percent stronger than they were a year earlier. After losing nearly 73,000 sales between March and May, Quebec ended the year with 371,124 vehicles sold, a decrease of slightly less than 80,000 units.

Alberta

At 183,540 sales in 2020, Alberta auto sales slipped 17 per cent from 2019. Although Alberta reported only one monthly year-over-year increase in the final 10 months of the year, the market was only slightly off-balanced throughout much of the second-half. Auto sales decreased by 37,323 units during the first four months of the crisis, but then fell by only 3,205 units over the following six-month span.

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British Columbia (including Territories)

By the end of 2020, British Columbia (including its northerly neighbours in StatsCan’s counter) performed slightly better than the national average. BC auto sales dropped 18 percent – Canada was down 20 percent – to 171,412 units, a drop of 37,000 sales from 2019. BC’s loss occurred almost exclusively in the spring and summer. During a four-month span to end the year, auto sales in BC actually rose 4 percent.

Manitoba

Largest among Canada’s six small provincial auto markets, Manitoba still managed to lose more than 10,000 sales in 2020. Yet the tail end of March didn’t drag Manitoba’s auto market down as sharply as any other province in the country – sales slid “only” 40 percent compared to the 49 per cent national average. Indeed, Manitoba’s declines throughout the spring weren’t as severe as anywhere else: March-to-May volume was down “only” 34 percent.

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Nova Scotia

The most populous province inside the short-lived Atlantic Bubble still produced the most auto sales of the four east coast markets in 2020, but its losses were more severe and its recovery less impressive. 39,891 vehicles were sold in Nova Scotia in 2020, a 22 percent year-over-year decrease of more than 11,000 units. Between March and May, Nova Scotia sales tumbled 45 percent, on par with its neighbours. But while NL, PEI, and New Brunswick reported marginal year-over-year decreases (or improvements) in the June-August recovery period, auto sales in Nova Scotia were still down 16 percent.

Saskatchewan

Since auto sales began their sharp decline in mid-March of 2020, Saskatchewan’s monthly auto sales performance punched above the national average all but once during a 10-month span. Only in July, when Saskatchewan’s 9 percent decrease trailed the national market’s 6 percent drop, did the prairie market appear inordinately slow. Statistics Canada says 41,817 vehicles were sold in Saskatchewan in 2020, down 14 per cent from 2019 levels, a decrease of nearly 7,000 vehicles.

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New Brunswick

Down “just” 16 per cent from 2019 levels, New Brunswick’s year-end auto sales volume in 2020 ticked down by nearly 6,400 units. Just how much of that drop occurred in the spring, during the peak of COVID shutdown impacts? In March, April, and May, New Brunswick’s new vehicle showrooms collectively recorded 5,332 fewer sales than during the same period, one year earlier. In the final four months of the year, on the other hand, New Brunswick actually grew volume by over 500 units compared with 2019.

Newfoundland and Labrador

Coincidence? The two Canadian auto markets that ended 2020 most closely aligned with 2019 output are both island provinces (No offence to Labrador, which accounts for just 6 percent of NL’s population). The sea’s natural protection against a global pandemic does no favours when it comes time for quick inventory replenishment, but with low levels of COVID, come lower levels of auto sales decline. After a 44 percent year-over-year sales decline between March and May, auto sales in Newfoundland and Labrador were up 7 percent in the June-August period. By December 2020, new vehicle sales volume in Newfoundland was 19 percent higher than it was in December 2019.

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Prince Edward Island

Canada’s smallest province, both geographically and by population, is naturally Canada’s smallest auto market, as well. Barely more than 7,000 new vehicles were registered in Prince Edward Island in 2020, an 1,110-unit (14 percent) decrease from 2019 levels. That decline was actually the second-smallest of the year – only Newfoundland reported a less consequential decrease. Down 59 percent from 2019 levels, PEI’s March decrease was actually the worst in the nation as the province moved quickly to limit border access for the final 10 days of the month. By June, volume had nearly returned to normal, and significant year-over-year improvement was reported in August, September, and October.