By: Luke Jones, Published on June 23, 2017 05:47 PM, Last Update on June 30, 2017 02:48 PM
Scotiabank says Canadians will continue to buy cars in huge quantities this year and predicts annual auto sales in the country will be record breaking during 2017.
The company admits its original forecast seems conservative and is now raising its prediction from 1.94 million to 2 million units. This would mean customers will help to break last year’s record setting 1.98 million units, according to Scotiabank’s Global Auto Report.
Scotiabank is pushing its forecast p based on monthly sales number that show auto is among the best performing sectors in Canada. Rising home values are being mooted as a potential rise in car sales, but many Canadians are spending much of their income on housing. Increasing wealth seems to be going to property, not to vehicles.
The most likely scenario is an increasing debt that many Canadians are taking on. While the car sales will break records, it will come at the cost of more debt nationwide through car finance loans. The report points out that customers have become accustomed to purchasing cars that they cannot afford to pay.
Low interest on vehicle loans (0% finance is common) are enticing customers to take out finance for five years and more.