Canada’s auto parts industry is likely to post considerably lower profits in 2013, according to a Conference Board of Canada report released August 28.
Canada’s Industrial Profile – Summer 2013, reported that vehicle parts manufacturers nationwide are expected to post pre-tax profits of $16.5 billion in this year, down more than 16% from 2012.
The report anticipates the sector to rebound slightly in 2014, growing 5.5% due to an expected increase in vehicle sales in the U.S.
“The motor vehicle parts industry will produce only marginal growth this year,” said Michael Burt, the conference board’s director of industrial trends.
“However, this slowdown should only be temporary. U.S. car sales are expected to reach their pre-recession level next year, which will drive parts production higher in the next couple of years.”
The study did warn, however, of the “ongoing shift” in North American vehicle assembly from the Midwest and Ontario to Mexico as a long-term threat to the auto parts sector.
