MANUFACTURING SALES

Manufacturing Activity Already Slumping Prior to Rail Blockades and Coronavirus

Highlights

• Manufacturing sales declined 0.2 per cent to $56.1 billion in January, the fifth straight monthly decline.
• Sales fell in 6 of 11 major industries, with the biggest losses occurring in motor vehicle and parts and petroleum and coal refining. These losses were partly offset by solid gains in fabricated metals, machinery, food products, and aerospace.
• Sales also fell in six provinces, led by Newfoundland and Labrador, New Brunswick, and BC.
• On a positive note, both unfilled orders and new orders increased in January, as did the industry’s capacity utilization rate.
• This report shows that Canadian factories were already struggling prior to the severe negative headwinds of the rail blockades and COVID-19 outbreak. With the economic impact of the outbreak continuing to mount, government action is needed to support manufacturers in this trying time. CME is working closely with all levels of government on the response to this ongoing crisis.

MANUFACTURING SALES FALL 0.2 PER CENT IN JANUARY

Manufacturing sales fell for the fifth straight month in January, down by 0.2 per cent to $56.1 billion. With this decline, sales dropped to their lowest level since April 2018. Adjusted for inflation, manufacturing sales declined by an even steeper 0.4 per cent.

The January manufacturing sales report shows that Canadian factories were already struggling prior to the severe negative headwinds of the rail blockades and COVID-19 outbreak. With the economic impact of the outbreak continuing to mount, government action is needed to support manufacturers in this trying time. Canadian Manufacturers & Exporters is working closely with all levels of government on the response to this ongoing crisis.

SIX OF 11 MAJOR INDUSTRIES POST DECLINES

Six of 11 major industries recorded declines in January, with the biggest losses occurring in motor vehicle and parts (-7.6 per cent) and petroleum and coal refining (-5.2 per cent). As noted by Statistics Canada, motor vehicle and parts sales were weighed down by temporary shutdowns at some assembly plants and the December 2019 closure of GM’s plant in Oshawa. Meanwhile, partial shutdowns at some refineries for maintenance work, along with lower prices, fueled the decline in petroleum and coal refining sales. These losses were partly offset by solid gains in in fabricated metals (4.6 per cent, machinery (4.6 per cent), food products (2.6 per cent), and aerospace (2.4 per cent).