September 4, 2012 / 10:48 PM / 6 years ago

Canadian auto sales rise in August; Ford stays No.1

(Reuters) - Vehicle sales in Canada rose 6.4 percent in August boosted by demand for Japanese and other imported brands as the Detroit Three, traditionally the mainstay of the market, put in a mixed sales performance, according to data the auto companies released on Tuesday.

Ford Motor Co of Canada (F.N) remained the top-selling automaker in Canada last month and year-to-date even though its sales dipped on weakness in demand for its passenger cars.

Ford, whose vehicle line-up includes the Ford Escape and Ford Mustang, said its sales slipped 1.8 percent to 25,461 in August on the back of a 29.2 percent drop in total car sales. Truck sales were up 8.1 percent.

“The Canadian industry continues to show steady growth, and at Ford we are seeing an increasing number of customers in our showrooms,” said Dianne Craig, chief executive of Ford of Canada.

General Motors Canada (GM.N) clung onto No.2 spot in August although its sales slumped 15.9 percent to 21,070.

Sales at Chrysler Canada FIA.MI, which produces Chrysler, Dodge, Jeep, and RAM brands, rose 9 percent to 20,569, boosted by demand for fuel-efficient passenger cars.

Independent auto analyst Dennis DesRosiers said the Detroit Three’s market share in Canada has shrunk to below 45 percent, a factor that will make it tough for the Canadian Auto Workers union to push its demands in current contract talks with the car companies. A year ago Detroit auto makers’ market share was close to 50 percent.

It is “hard to argue for more compensation when the Detroit Three are continuing to lose market share - especially when Canadian labor costs are the highest anywhere in the automotive world,” DesRosiers said.

Less than two weeks before their contract expires, Canadian auto workers and Ford, GM and Chrysler remain far apart in discussions on new labor contracts and frustration is creeping in, union officials said on Tuesday.

Among Japanese automakers, Toyota Canada (7203.T) said it had a record August with sales surging 25.3 percent to 17,556 Toyota, Lexus and Scion vehicles, driven by all-new models and refreshed designs.

Imported names, such as Volkswagen (VOWG_p.DE) enjoyed a 34 percent rise in Canadian sales and Kia (000270.KS) a 32.4 percent jump.

In the United States, automakers turned in their best August since before the 2007-09 recession, with monthly auto sales rising 20 percent from a year ago as consumers with aging vehicles showed more confidence in buying big-ticket items on easier credit terms.

Reporting By Nicole Mordant in Vancouver; Editing by Peter Galloway and Bob Burgdorfer

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