Ford tops again in Canada as GM sales shrink

The Montreal Gazette - Ford Motor Co. of Canada, Ltd., claimed the auto sales crown in Canada in 2011 for the second year running after its primary rival, General Motors of Canada Ltd., had its market share shrink to the smallest level in at least 100 years.

Not only has the once-dominant GM fallen behind Ford, in 2012 Chrysler could move up to the No. 2 spot, according to Dennis DesRosiers, president of DesRosiers Automotive Consultants. Chrysler has had an impressive run over the past two years, and was the leading market share gainer in 2011 for the second year in a row.

GM managed to sell just 11,238 more vehicles last year than Chrysler in Canada (242,830 vehicles for GM compared to 230,992 at Chrysler) after a 13 per cent sales gain by its smaller rival. GM's own sales fell 1.6 per cent year over year.

As a result, Chrysler's market share improved 0.7 per cent in 2011 to 14.5 per cent, while GM's fell 0.5 per cent to 15.3 per cent, its lowest point in at least a hundred years or as long as modern statistics have been recorded, DesRosiers said.

Ford, whose sales were up three per cent last year, held a commanding market share lead at 17.4 per cent at the end of 2011, up 0.2 per cent year over year.

The Japanese manufacturers are, however, ramping up production again, and Des-Rosiers said he expects they will collectively win back between three and five per cent market share in 2012. Where those ultimately come from will help determine whether GM can hold its No. 2 spot in the country in 2012, he said.

"The Europeans are fairly safe because they don't really compete with the Japanese. The Koreans won't easily give up share, if anything will pick up share because they're so price competitive," he said. "It comes down to GM, Ford and Chrysler. If Chrysler were to hold its share, there's a chance GM could lose enough to threaten its No. 2 position."

But he noted Chrysler's sales gains in the last two years have largely been dealer incentive driven, which might not be sustainable throughout this year. GM, on the other hand, has promised to continue pushing increased profitability over the sort of highvolume, low-margin business that drove it into bankruptcy protection in 2009.

"Can Chrysler maintain that sort of incentive money? I doubt that they could," DesRosiers said. "If they pull back from their incentive money, Chrysler will have a bad year."

"This is going to be the story of next year," he added.

Meanwhile, Hyundai Auto Canada Corp. had a banner year in 2011, overtaking Honda Canada in the sales race and breaking into the top five for the first time in its history. Hyundai's Japanese rivals were plagued by vehicle shortages stemming from the earthquake in Japan and the subsequent flooding in Thailand.

But while robust sales of the Elantra helped spur a nine per cent sales gain for Hyundai last year, it wasn't sufficient to keep Honda's Civic model from taking the title of the top selling passenger car in Canada for the 14th straight year. Honda and Toyota saw their sales fall 13 per cent and 5.6 per cent respectively, in 2011.

Overall, Canadian auto sales were up 1.8 per cent year over year in 2011 to 1.59 million vehicles, according to DesRosiers' figures.