Canadian auto sales surge to record high in May

(Adds data for Ford and Fiat Chrysler, analyst commentary)

By Allison Lampert

Canadian auto sales hit a
record high in May, with General Motors Co and Ford Motor
Co on Thursday reporting double-digit increases, fueled by
demand for crossovers and light trucks, according to analysts
who compile the monthly data.

One economist attributed the record May sales to discounting
among the large automakers in a fight for market share.

Automakers sold 216,861 vehicles in May, a number which
“smashed all previous monthly records,” and was up 11 percent
compared with the same month a year earlier, Canadian auto
analyst Dennis DesRosiers wrote in a note.

Year-to-date auto sales in Canada reached 835,582 units
representing a 4.7 percent increase over the previous year,
DesRosiers wrote.

Scotiabank senior economist Carlos Gomes attributed the
strong May sales figures to discounting. “I would call it
incentive heaven,” he said by phone from Toronto.

Gomes said he now expects another record-breaking year for
Canadian auto sales. He plans to revise his April forecast that
said Canadian auto sales would decline slightly in 2017 to about
1.94 million vehicles, from a record-breaking 1.97 million units
in 2016.

By contrast, in the United States, automakers reported sales
fell 1 percent from a year ago. This brought the annualized
sales pace down to 16.66 million cars and light trucks from
17.17 million vehicles a year ago, according to figures compiled
by Motor Intelligence.

“We’re going to have to increase our Canadian forecast and
reduce our U.S. forecast,” Gomes said.

In Canada, Ford reported the sale of 34,486 vehicles, up 17
percent compared with the same month a year earlier and the best
sales for a month of May since 1989.

General Motors said it sold 31,149 vehicles in Canada last
month, a 36 percent rise compared with a year earlier, fueled by
demand for crossovers and light trucks.

The company added that was its best performance for May in
eight years. It contrasted with a 16.4 percent drop in sales in
May 2016 versus the year-earlier period.

Fiat Chrysler said it sold 33,186 vehicles, up 5
percent from May 2016 and the highest monthly Canadian sales in
its history.
(Reporting by Allison Lampert; Editing by Jim Finkle and James

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