Canadian vehicle sales declined 8.2% in February amid EV market ‘collapse': DesRosiers
New-vehicle sales in Canada fell close to 10 per cent in February, driven in part by a 'stunning' decline in battery-electric vehicle sales and a record comparable month last year, according to DesRosiers Automotive Consultants (DAC).
Despite the year-over-year slide, DAC Managing Partner Andrew King said estimated February sales of 122,000 vehicles was 'solid.' Monthly sales figures are estimates because most automakers report only on a quarterly basis. Ford only reports annually.
'While a decline of 8.2 per cent sounds concerning, it should be remembered that February 2024 was easily the strongest February of all time — as finally a plentiful supply of vehicles was available after 30 months of shortages,' King said.
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Toyota recorded the biggest February decline among manufacturers that report monthly, with sales falling nearly 25 per cent year over year to 11,660 vehicles, according to the Automotive News Research & Data Center in Detroit.
Sales dropped 10.9 per cent at Kia; 6.4 per cent at Honda; 4.3 per cent at Volvo Cars; and 1.8 per cent at Subaru.
Hyundai, meantime, stayed ahead of its pace last year, with sales of 9,200 topping February 2024 by 6.5 per cent.
Mazda also bucked the downward trend, thanks mainly to strong sales of its CX-50. The company sold 988 of the compact crossovers in February, close to double the 546 it sold a year earlier. Relatively small declines in sales of the CX-30 and CX-5 were offset by comparable gains by the Mazda 3 and CX-90. Across its entire lineup, the brand sold 4,559 vehicles in February, up 11.9 per cent from the same month a year earlier.
Unlike the relative steadiness of the overall market, EV sales faced an 'astonishing' collapse during the second month of 2025, DAC said.
After the chaotic end to the federal Incentives for Zero-Emission Vehicles program in January and a pause to Quebec's rebate program, February was the first full month that EV buyers in Canada lacked access to either incentive.
'Stunning declines were witnessed by a plethora of BEVs, as sales plummeted across the segment,' DAC said.
According to the Automotive News Research & Data Center, exclusively electric models experienced sales declines of as much as 85 per cent in February.
Hyundai's Ioniq 5 and 6 posted year-over-year declines of 37.9 per cent and 81.4 per cent, respectively, in February. Toyota BZ4x sales slid 73.2 per cent to 107 vehicles from 399. And sales of the Kia EV5 declined 85.8 per cent to 65 vehicles from 457 last February.
The dramatic decline in EV sales extends the negative trend in January flagged by S&P Global Mobility, when the federal and Quebec rebates were still in play for a portion of the month.
While the February sales total signals a 'healthy' auto retail market in Canada, with the seasonally adjusted annual rate coming it at two million vehicles, tariffs threaten to upend the momentum, DAC said.
American tariffs of 25 per cent on most imports from Canada and Mexico came into force at 12:01 a.m. March 4. President Donald Trump issued a one-month exemption for automotive 36 hours later, but further U.S. tariffs on imports of steel and aluminum are expected March 12, as well as global reciprocal tariffs in April.
The Canadian government's response could also influence sales. Ottawa retaliated to Trump's salvo immediately with 25-per-cent tariffs on $30 billion worth of U.S. goods. A second tranche of retaliatory tariffs on $125 billion of U.S. imports, likely to include vehicles and auto parts, will kick in if U.S. tariffs return April 2.
'Whether we will see another month in 2025 reach a SAAR of two million depends greatly upon how the tariff situation unfolds,' DAC said.
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