Canada’s automotive market in trouble 0

Investment in Canada’s motor industry is set to hit its lowest figures since the 1980’s. In what is a troubling time for the countries automotive industry, many are worrying for the future.

Much of the work is being transferred to Mexico and the USA as a result of poor funding in the country. Investment in auto assembly and part plants within the country is set to drop to $1.2 billion next year. On average in the past decade, £3.1 billion has been invested yearly into the industry.

Honda in particular will be worried at the news after they announced that they are planning to release new models dedicated to Canada. General Motors also had promising plans for Canada.

USA and Mexico are more stable

Carlos Gomes, a Scotia Senior Economist indicated that the USA’s and Mexico’s motor industry is a more stable position than Canada. He said “Recent announcements of new products and hires for Canada by both General Motors and Honda are encouraging,”

“However, these announcements pale in comparison with the news coming from Mexico — the auto industry’s North American growth leader.”

“We had seen investment come down across the board. Not only in Canada but in the United States as well as in Mexico over the last little while,”

“The worrisome point is that while it has started to stabilize in the other two countries, that has not been in Canada.”

Not the way it used to be

The American motor industry is set to see a $4 billion investment next year. Japanese car manufacturers announced plans to invest £3 billion into the Mexican automotive industry. This stands in stark contrast compared to the Canadian automotive market.

Carlos Gomes has said times have changed and roles have been reversed somewhat.  He said  “This represents a sharp reversal from the trend of the past decade, when investment in the Canadian auto industry was, on average, 3% higher than either in the United States or Mexico,”

“While investment in Canada remains marginally higher than in Mexico, recent announcements indicate that over the next several years, investment in Mexico’s auto industry is set to approach (greater heights).”

The Canadian motor industry has a bleak outlook and need more investment if they are stay out of decline.