Canada’s Auto Outlook: Ready to Upshift?

The Conference Board of Canada, June 12, 2017 at 02:00 PM EDT
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Canada’s motor vehicle and motor vehicle parts manufacturing industries are enjoying a solid start to 2017. American sales continue to speed along at a record pace, which ensures strong demand for Canadian automotive products. Canadian automakers export nearly 9 out of 10 vehicles they assemble to the U.S., and parts manufacturers sell about half their products south of the border.

However, uncertainty surrounding the future of the North American Free Trade Agreement (NAFTA) continues to undermine an otherwise optimistic industry outlook. NAFTA hastened the integration of the North American auto sector, but the Trump Administration has signalled that it is looking to boost production in the U.S., even if heightened protectionism comes at the expense of foreign trade partners, including Canada and Mexico.

The Canadian subsidiaries of the Detroit Three have reached contract agreements with their workers that include stable production volumes through 2020. General Motors is closing its Consolidated Line in Oshawa in 2017, but work on other models should maintain production in Oshawa at current levels. Canadian auto assemblers specialize in the more profitable truck segment of the North American light-vehicle market— which is also a segment in which parts makers have a competitive advantage.

Demand should be sufficiently strongly to sustain parts manufacturing at healthy levels throughout the forecast. The growing export intensity of the auto parts manufacturing industry will help shield parts makers from the closure of the Consolidated Line.

In this webinar, Sabrina Bond presents the short-and medium-term economic and profitability outlook for Canada’s Motor Vehicle Manufacturing Industry and Motor Vehicle Parts Manufacturing Industry. Based on the Conference Board’s Canadian Industrial Outlook Service, Sabrina will cover production, prices, investment levels, employment revenues, labour and material costs, profits and prof

Webinar Highlights

During this webinar, Sabrina will expand on:

  • Vehicle Sales—Annual vehicle sales in the U.S. will remain at or above the 17-million mark through 2021.
  • Investment—Canadian automakers have committed $2.0 billion for upgrades to existing assembly facilities and enhancements to the upstream value chain.
  • NAFTA’s future — This forecast assumes that the NAFTA remains in place through the next five years, but the auto sector could be among the most affected sectors of the economy if significant changes are made to the agreement.

About Sabrina

Sabrina Bond is a contributor to the Conference Board's Provincial, National, and Industrial Forecast teams, and provides current economic analysis on business investment, business confidence, the Ontario economy, and the automotive sector. Sabrina is the author of a variety of economic publications, with topics touching on fiscal reform, federal and provincial budgetary analysis, health care reform, and labour market imbalances. She has expertise in cost-benefit analysis, and has also created a range of custom economic models for private clients. Ms. Bond is a regular spokesperson for the Conference Board, and delivers presentations and economic commentary in the media on her work.

Photo of Sabrina BondSabrina is an MBA graduate and Bregman Scholar of the Rotman School of Management at the University of Toronto, and holds a Master's of Economics from York University and a B.A. (Hons.) with distinction from Queen's University.

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Price: $249.00 (CAD)