Canadian auto sales set record

[OntarioVanMan]

Sep 05, 2007

The credit crisis that rocked world markets isn't slowing down Canada's record-breaking auto sector.

While the U.S. industry sputters because of the housing slump and subprime loan fiasco, consumers in Canada bought more cars and light trucks than in any other August in the country's history.

Sales and leases of new autos climbed 3.1 per cent here, or more than 4,700 to 158,394 vehicles in August from the same month last year, statistics from the manufacturers showed yesterday

In the U.S., overall sales dipped 0.6 of a per cent in August after plunging 12 per cent in July. But industry leader GM surprised analysts as its pickup sales rebounded and shot up 16 per cent south of the border, for a surprising 6.1 per cent gain overall.

The results in Canada topped the previous August sales record set last year. It also marked the fifth consecutive month that sales have increased from the corresponding period last year.

In eight months of this year, Canadian auto sales have jumped 4.7 per cent or about 53,000 to 1.16 million cars and light trucks from the same period in 2006.

DesRosiers, president of DesRosiers Automotive Consultants, noted that for the first time this year, the Big Three North American-based automakers – GM, Ford and Chrysler – picked up market share from the offshore-based manufacturers in Canada

 

[greg334]

What credit crisis? I have no problems getting credit - been offered too much credit.

I think that we must remember that Canada is a foreign country and they have a different market. With that, the US car makers should not get too happy about this and think that things will turn around here in the states, they still need a product line to compete in the home market, which they don't have yet. I was reminded that the situation is just like the UK dealt with in the 80's.

Good for Canada.

 

[OntarioVanMan]

Credit Crisis??

Greg..you not following the markets lately????

The National Association of Realtors had more bad news about the housing market today.

The NAR said its pending home sales index fell 12.2% in July to a reading of 89.9 -- the index's lowest level since September 2001. The index had risen 5% in June.

"It's difficult to fully account for mortgage disruptions in the index," NAR senior economist Lawrence Yun said in a press release, noting the recent turmoil in the mortgage markets. "Our members are telling us some sales contracts aren't closing because mortgage commitments have been falling through at the last moment," Yun said.

Because all those low cost flex mortgages are set to expire people are going to have to re-finace at true market value, many of them can't afford a 3-5% hike in rates.

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And while July might have been ugly for pending home sales, August was pretty ugly for the job market.

A report by outplacement firm Challenger, Gray & Christmas said that layoff announcements soared 85% to 79,459 in August, mostly due to the mortgage-market mess.

August job cuts were 22% higher than the number of cuts announced in August 2006.

"The story in August revolves around the dramatic collapse of the mortgage and subprime lending markets," Chief Executive Officer John Challenger said in a press release.

"There were early warning signs in April as a few major subprime lenders went under and released workers," Challenger added. "However, what had been a relatively small number of job cuts suddenly turned into a deluge in August as financial institutions literally shut down operations overnight."

The financial sector alone cut 35,752 jobs last month, the highest monthly number of announced cuts since the firm first started to track job cuts in 1993.

And Challenger predicted that "these cuts are just the beginning."

One final comment about the financial world: It's populated with rich, hypocritical whiners. Wall Street, the hedge-fund community and their lap dogs in the news media continually brag about how much they love capitalism and free markets.

Yet when the creative-destruction component of capitalism rears its ugly head, they want the central planners to bail them out immediately, before they take any pain. And the ones clamoring the loudest are the very same folks who behaved the most irresponsibly.

 

[cheri1122]

One didn't even need to read the newspapers, or watch tv to see that a housing crisis was coming - just observation of the houses being built the past 5 years would be enough. No one has been building "affordable" housing, for working class folks, it's virtually all seriously 'upscale' housing. Every builder and developer has sacrificed common sense for potential profit, looks like.
Same goes for the commercial realty market - observe all the new spaces being built, right alongside all the old spaces, with signs shouting "Available!" on nearly all of them - on some streets, there's a sign on EVERY ONE of them!
And you gotta love the banks' excuses for the collapse of the subprime market - did they not see that coming, with the jobs being cut/lost every single day?!
One thing the banks aren't saying, is why the rate of foreclosures jumped. I have to wonder how many are because of irresponsible buyers, (which says the mortgage officers were incompetent), and how many due to unexpected loss of a job, or sudden, high health care costs?

 

[greg334]

Sorry OVM, but I know what is going on - the same thing that happened in the mid 80's and it is all right with me.

Why?

Because the housing market is over inflated - take some economics classes and you will see clearly (as Cherri pointed out) that the market is built on false support (built on credit very little equity) would collapse at a point when credit becomes tight – hence the feds raising rates to keep inflation in check triggering this mess.

This was warned by people who really understand the cause and effect of things, not the idiot commentators or professors of U of M who haven’t been out of the class room for a decade.

This is the exact same thing that happened in the mid 20’s with the changes in the laws to allow banks to load money more freely – resulting in the 1928 and 1929 economic problems which led to the depression.

The stock market is an emotional market, as is the commodities and FX markets, all are driven by emotion. The housing market is something that is controlled a bit differently and the losses in the housing market never had long term effects like the others I mentioned. until recently, the housing market was used as a secondary indicator for a number of studies to gage our economic situation, now it is talked about like it more important then other indicators.

This morning at breakfast, we discussed this very problem and after the numbers were thrown out, I said I would like to see a 40% adjustment on housing and property prices because I don’t think that a house like my fathers should have increased in value 75% in 4 years, maybe 30% growth is a good thing. A couple were taken back by the comment but most understood what I meant without explaining it. A house near my father’s was auctioned off for $7000. It was foreclosed on because the owners overextended themselves with a $175K between the couple who lived there.

The amazing thing is, they are still building, and they are throwing up subdivisions like nothing has happened. Sure these developers will take a ‘loss’ but they will still make a profit – amazing.

I still don’t have a problem with credit, but I don’t have a thing I want to get right now anyway but the point is – the problem is I can still get credit with my bad credit at a time when I shouldn’t get it.

My home is locked in, I own a third of my Father’s home and I have property paid for with only outrageous taxes due. I am in the best situation I have been in years, poor but better than having all that credit cards and other debt.

 

[OntarioVanMan]

Glad we own our little 12 acres and NO mortgage! The hay income pays the taxes of a whopping $375 a year!!!

 

[greg334]

My 10 acres was moved to the family trust two years ago (and is considered a transfer between family members by law) and it went from 600 to 890 because they mistakenly re asset the place. I was told that it would be adjusted and I would get another bill to reflect the correct (600) tax but yesterday I got an 1100 tax bill with late fees tagged on. Beside now I get a 140 school tax bill I never got before - Michigan sucks.

 

[OntarioVanMan]

Mine is assessed at agricultural rates....not city rates.

Boy Michigan really does suck....