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Statistics Canada says manufacturing sales fall 2.6 per cent in July

Last Updated Sep 19, 2017 at 10:40 am EDT

OTTAWA – Canadian factory sales fell for a second consecutive month in July, Statistics Canada said Tuesday due in large part to a drop in the auto sector.

Manufacturing sales fell 2.6 per cent to $52.5 billion in July following a 1.9 per cent drop in June.

Sales were down 1.4 per cent in July on a constant basis.

“The second month of declines in both value and volumes suggests that momentum may be fading somewhat at Canadian factories,” TD Bank senior economist Brian DePratto wrote in a report.

“To be sure, with a shift in the shutdown schedule at auto plants contributing significantly to the pullback, a rebound may be in store next month as these assembly lines come back to life. But with the forward-looking indicators down again in July, rebound expectations should be tempered.”

Statistics Canada said the annual auto assembly plant summer shutdowns were longer and more concentrated in July than in previous years and that changes to the models being manufactured in Canada also contributed to the decline.

Excluding motor vehicles and motor vehicle parts, manufacturing sales increased 0.2 per cent.

Sales fell in nine of 21 industries, representing 57 per cent of the manufacturing sector.

Sales of transportation equipment fell 13.8 per cent to $9.6 billion in July due a 19.9 per cent drop in motor vehicles and a 11.3 per cent move lower by motor vehicle parts.

Food industry sales also fell 0.9 per cent, while gains were made by the wood products sector which gained 2.3 per cent and primary metals which added 1.9 per cent. Non-metallic mineral products gained 4.4 per cent.