Published twice a year, the Canadian Industrial Outlook Service includes detailed, five-year forecasts in 10 key Canadian industry sectors. Outlooks for several financial and economic variables—prices, production, revenues and expenditures, profits, gross domestic product, and employment—are generated, based on forecasts of key domestic and international factors such as interest rates, exchange rates and tax policy.
Document Highlights
Canada’s Auto and Auto Parts Industry: Industrial Outlook forecasts investment spending, revenue, costs and profits for the auto and auto parts industry by analyzing its three key sectors: motor vehicle manufacturing, body and trailer manufacturing, and parts manufacturing.
A sharp rebound in revenue growth will help profits rebound slightly this year, to $2.5 billion. Next year, much stronger profits of $5.3 billion are anticipated, thanks to a slowdown in the growth of total costs.
From 2006 to 2008, profits will range from between $5.7 to $5.9 billion, with profit margins of around 3.5 per cent—much lower than those in 1999 and 2000, due to the increased competition facing the Big Three auto manufacturers from vehicle assemblers in Canada such as Toyota and Honda, as well as from auto manufacturers in southern parts of the United States. Profit margins will be highest in the parts sector, partly because auto parts suppliers have diversified their sales away from their reliance on the Big Three towards auto manufacturers outside North America.
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