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RICHMOND HILL, Ontario — While Canada's new-vehicle sales climbed 0.6 percent year-over-year in May, a better indicator of the market's health is the seasonally adjusted annualized rate, according to DesRosiers Automotive Consultants.  

And judging by the company's data, May perhaps wasn't as solid as the raw sales data comparisons might suggest. Overall, 154,927 new-vehicles were sold in Canada during May, compared with 154,018 units in May 2009.

"Comparables … a nasty little word that many OEMs don't like to include in their monthly press releases. By this I mean everyone likes to be selective in terms of which months they compare their sales to, with the obvious intent of making themselves look good," said Dennis DesRosiers, company president.

"The proper way to look at sales is to take a longer-term view and not to focus too heavily on (May over last May) sales (comparisons) since at either end of this equation, there can be some funny things that make sales performance look either very good or very bad," he continued. "That is why we now also publish a SAAR with our monthly sales release, which takes 10 years of monthly sales data and estimates what the current month really is telling the market given long-term trends."

The SAAR during last month was 1.45 million vehicles, which DesRosiers called "atrociously low by any measure." This is also much weaker than what the year-over-year increase suggests, he added.

"It is now coming up on a year where sale have been tracking on a SAAR basis in the 1.5 million range," DesRosiers pointed out. "This should tell the industry something, if any want to listen."

DesRosiers also conducted what he called a "fairer comparable" for various manufacturers' May performances to give a better gauge for how strong or weak their sales really were.

Basically, he used May 2008 — a much more "normal" period for auto sales — as the comparison period for May 2010 rather than comparing last month's sales to 2009, which was a rather unusual and topsy-turvy period.

"Perhaps a little high compared to earlier in the decade but a lot fairer comparison than May 2009 when sales were in the toilet, especially for some individual brands like Chrysler and GM, who were in the middle of bankruptcy proceedings," DesRosiers shared.

Looking at some individual automakers, Chrysler's May sales of 20,861 vehicles is a 53.5 percent-gain from a year ago, but up against the more normal period of 2008, they're off 23.3 percent.

General Motors, which sold 25,995 vehicles in May, was off 17.6 percent from a year ago but down 27.7 percent from May 2008.

Ford's sales (26,110 units) were up 10.8 percent from a May 2008 and up 19.4 percent versus a year ago.

Toyota's sales (16,461 units) fell 16.6 percent from last year, but were down even further from two years ago (down 38.3 percent).

Hyundai posted May sales of 12,620, which was up 12.6 percent over May 2009, but represents an even greater gain from 2008 with an increase of 32.7 percent.

There were 10,084 Honda units sold in May, which marks a 28.2-percent dip from last year and a 40.3-percent decline from two years ago.

Among the "surprises" DesRosiers found were two in the year-to-date data. Toyota's sales so far this year (71,290 units) are off 22.9 percent from the 2008 comparable and Honda's (47,773) were down 20.4 percent, putting both of these in the bottom three of the largest six automakers when comparing data to 2008.

"Honda, indeed, is the worse-performing and Toyota is the third worse performing OEM on this chart when a fairer comparable is used," DesRosiers pointed out. "We had gotten so used to these companies walking on water that we lose track of the fact that they can also stumble from time to time."

Interestingly enough, Ford and Hyundai were the only two among the six largest OEMs (Ford, GM, Chrysler, Toyota, Hyundai, Honda) to show gains for both year-to-date and May sales when compared to both the 2008 and 2009 periods.

"And look at Ford and Hyundai … both up nicely not only on the month and YTD from a year ago, but also from two years ago," DesRosiers pointed out. "Now that is impressive."

Continuing on with his commentary, DesRosiers said that it is truly puzzling as to why May's SAAAR was so slow.

"We have been saying all along that sales have been lean for some nine or 10 months, but nobody would have predicted that May would be this bad, especially on a SAAR basis," he noted. "It may be fleet that is behind this, but we don't see fleet sales for a number of weeks."

Perhaps it is the fact that there isn't as much "need" in the market, DesRosiers suggested.

"And there is no doubt that Canadians significantly overbought vehicles for most of the last decade, so maybe it is needs-based buyers that are not in the market," he pointed out. "Anybody who bought a new vehicle in the last five to eight years quite frankly doesn't need to buy another for quite some time."

DesRosiers added: "The average vehicle bought in the last five to eight years will not be scrapped for at least 15 and possibly 25 years and will last 350,000 to 400,000 kilometers, so the fundamental need for a new vehicle is weak and is unlikely to strengthen for quite some time."