Quick take

Trucks didn’t block manufacturing sales from growing in February

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  • Canadian manufacturing sales rose by 4.2 per cent (m/m) in February. This was higher than Statistics Canada’s flash estimate, which called for a 3.7 per cent increase. After accounting for price effects, manufacturing sales volumes rose by 2.2 per cent.
  • Nominal sales grew in 14 of the 21 manufacturing subsectors. In absolute terms, sales of transportation equipment (+11.6 per cent) and food manufacturing products (+5.3 per cent) grew the most. Meanwhile, sales of computer and electronic products (-7.9 per cent) saw the sharpest absolute decline.
  • Manufacturing sales grew in all 10 provinces, especially in Saskatchewan (+9.5 per cent), Alberta (+7.2 per cent), and Manitoba (+6.6 per cent).
  • New orders increased by 2.4 per cent, while unfilled orders grew by 0.9 per cent.

Key Insights:

  • Canadian manufacturing sales managed to grow in February even as horns blared and trucks blocked exports from crossing the Ambassador Bridge in Windsor. Though the blockade lasted less than a week, it did bring some auto production lines to a halt as the cross-border movement of components slowed. Producers found a way to work around this, allowing real motor vehicle manufacturing sales to grow by 25.0 per cent.
  • The pandemic has surged in China, and the country’s “zero-Covid” policy has slowed domestic production. Global supply chains that were already bending under the strain of the Russian invasion of Ukraine are being bowed further. Canadian manufacturers will likely face ongoing disruptions and delays for components sourced from Asia. This will continue to impact manufacturing sales until the situation improves.
  • Higher input prices and worker shortages remain the concerns of the day for Canadian producers. But adjusting to climate change and Canada’s emissions reduction plan will pose challenges and provide opportunities. Motor vehicle manufacturing will play a big part in the transition. Electric vehicles (EVs) also featured prominently in the recent federal budget. In Windsor, a multi-billion-dollar EV battery plant could be operational in 2024. However, emissions will have to fall dramatically to meet targets outlined in the 2030 Emissions Reduction Plan. Tax credits for investment in clean technology and carbon capture will help manufacturers meet these targets. Still, there is plenty of work to do.

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Kiefer Van Mulligen

Kiefer Van Mulligen


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