Compare the automotive sector in Canada and the United States and you might be forgiven for thinking that the two countries were in different parts of the world. Of the 15.22m light vehicles sold in North America in 2011, just 1,585,519 were sold in Canada, according to the Association of International Automobile Manufacturers of Canada (AIAMC). 

So the largest single vehicle market in the world, the US,shares a border with the second largest country in the world by area, which despite its size, saw fewer car sales than the United Kingdom.Factor in a population of around 34 million,compared with around 313 million in the US and the sales figures make more sense. A sizeable chunk of Canada’s enormous territory lies in the Arctic Circle,ensuring that the populations of the Yukon, Northern Territories andNunavut number around 103,000 over a combined area that makes up 39.5% of Canada’s total landmass.

Like their southern neighbours, Canadians like their light trucks. Some 891,748 (AIAMC) of the total in fact, or around 56% of the new light vehicle market, compared with some 52% for the United States. Again the comparative population density and Canada’s vast land mass help to explain the popularity of vehicles with all-terrain capability.

The 2011 light vehicle market in Canada saw a modest sales increase of around 2.1% compared with 2010. 2011 car sales fell compared with the previous year, following the recent downward trend in that sector. At the same time light truck sales followed the opposite trend, increasing compared with 2010.

Forecasts indicate that the decline in car sales may have bottomed out and 2012 will bring a modest increase, while light truck sales may start to level out. Scotia bank is forecasting a light vehicle market of 1.605m vehicles for 2012, an increase of around 1.2% on 2011,which would make 2012 sales the fifth highest on record for the country.

Figures from AIAMC show that 2012 got off to a good start. Light duty vehicle sales rose 15.4% on January 2011. Light truck sales showed an increase of 7.4% over January 2011 and cars were up 28.8%.

Despite the problems suffered by Japanese manufacturers last year, Honda claimed the Civic as Canada’s best selling car in 2011, even though that didn’t translate into best selling Japanese brand status. That accolade went to Toyota, with some 162,000 sales, the company featuring as the second best-selling car manufacturer and fourth overall best seller. At the same time, Canada produced some 2.07m vehicles, according to data from Scotia bank,building vehicles for Ford, GM,Honda/Acura and Toyota/Lexus at plants allocated in the province of Ontario, offering easy cross-border access to the US.

This industry suffered like many others in the 2008 financial crisis and its aftermath. In fact car manufacturing was already declining in the region with Ford and GM laying off workers from 2005/6.These cut backs have been offset to an extent by new facilities from Ford, GM and Toyota.

Fuel prices in Canada are generally higher than for the US, with a litre of petrol currently costing between €0.76 and €0.97 – between 27and 40% more expensive than in the US. This is still considerably cheaper than European prices.So it’s not particularly surprising that take-up of diesel models is low – approximately 3% of the passenger vehicle parc. But some commentators are expecting this to rise in the coming years, as more manufacturers offer diesel models. 

It seems that many SUVs are already sold with diesel engines and next year, smaller models, such as the Chevrolet Cruze, are expected to be offered with diesel power.

The trigger point for interest in diesel appears to be fleet average fuel economy regulations due to come into force by 2016. Forecasts for diesel market share in North America vary, but it looks as though somewhere in the 7 to 8% region by 2017 may notbe wide of the mark.

Petrol/electric hybrids do not feature strongly in the Canadian vehicle parc either,being responsible for just 0.3% of vehicles, according to Des Rosiers Automotive Consultants.The potential growth area for Canada appears to be with electric, plug-in and range extender hybrids, assisted – as in other countries– by tax incentives.