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New Cars - Canada - November 2016

"Automobile manufacturers and brands operating in Canada are facing a changing environment of evolving preferences and consumer demand. Generational considerations for type of vehicle and interest in vehicle features can be contrasting, as younger consumers prefer newer models and the latest technology innovations, while older drivers lean towards reliability and safety-oriented features. New registrations of passenger vehicles in Canada have grown by 20% from 2010-15 and are projected to continue on a moderate growth path in the coming years, displaying a bright future for auto sales in Canada."

- Andrew Zmijak, Research Analyst

This report will cover the following areas:

  • Men have their eyes set on a new car while more women are unsure
  • Reliability tops the list for new vehicle features, especially among over-45s
  • Vehicle recalls and scandals hurt brand image and sales

This Report will explore the presence of vehicles in Canadian households, the intent to purchase vehicles in the near future, the type of vehicle consumers are considering purchasing, the method of payment consumers intend to use to purchase their next vehicle, interest in new vehicle features and, more specifically, interest in safety and technology features. Macro-economic factors affecting the automotive industry, market size and forecasts are also explored. The Report also looks at marketing and advertising campaigns from this category and trends impacting the industry.

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Table of contents

  1. Overview

    • What you need to know
      • Definitions
      • Executive Summary

        • The issues
          • Men have their eyes set on a new car while more women are unsure
            • Figure 1: Kind of vehicle considered for next purchase, by gender, October 2016
          • Reliability tops the list for new vehicle features, especially among over-45s
            • Figure 2: New vehicle features (top three), 18-44s vs over-45s, October 2016
          • Vehicle recalls and scandals hurt brand image and sales
            • The opportunities
              • Chinese Canadians are eager to purchase a vehicle
                • Figure 3: Vehicle purchase plan, Chinese Canadians vs overall population, October 2016
              • Auto brands need to keep up with their safety feature offerings
                • Figure 4: Interest in vehicle features (top five), October 2016
              • Millennials to help support auto sales in Canada
                • What it means
                • The Market – What You Need to Know

                  • Moderate growth projected for new vehicle registrations in Canada
                    • Millennials will help boost auto sales in Canada
                      • Auto brands will benefit from a growing population that is ethnically diverse
                        • Interest rates and fuel prices remain low
                        • Market Size and Forecast

                          • Moderate growth forecast for new vehicle registrations in Canada
                              • Figure 5: Total volume of new registrations, cars, Canada, 2011-21
                              • Figure 6: Total volume of new registrations, cars, Canada, 2011-21
                            • Forecast methodology
                            • Market Factors

                              • Millennials will help boost auto sales in Canada
                                • Figure 7: Projected trends in the age structure of the Canadian population, 2014-19
                              • Auto brands will benefit from a growing population that is ethnically diverse
                                • Canada’s economy still struggles and increasing household debt will affect discretionary spending
                                  • Interest rates remain historically low
                                    • The effect of gasoline prices
                                      • Figure 8: Average retail prices for regular gasoline in Canada, 2013-16
                                  • Key Players – What You Need to Know

                                    • Interest rates remain very low
                                      • Dealers advertising clear out events and boasting brand achievements
                                        • Seasonal emphasis helps promote new vehicle lineups
                                          • Strong sales for the Canadian auto industry
                                            • Midsized SUVs and crossovers prove popular
                                              • Vehicle recalls and scandals
                                                • Investment in automotive innovations may change the automotive landscape
                                                • Marketing and Advertising

                                                  • Interest rates remain very low
                                                    • Figure 9: Ottawa Dodge, acquisition mail, September 2016
                                                    • Figure 10: Toyota, acquisition mail, September 2016
                                                  • Marketing clear out events and boasting achievements for dealerships
                                                    • Figure 11: Rallye Motors Nissan, acquisition mail, September 2016
                                                  • Seasonal emphasis to help push new vehicle lineups
                                                    • Figure 12: Hyundai Canada, loyalty mailing, September 2016
                                                  • Targeting parents via in-car entertainment and Wi-Fi
                                                  • What’s Working?

                                                    • Strong sales for the Canadian auto industry
                                                      • Midsized SUVs and crossovers a strong point for auto sales
                                                      • What’s Struggling?

                                                        • Vehicle recalls and scandals
                                                        • What’s Next?

                                                          • Investment in automotive innovations may change the automotive landscape
                                                            • Manufacturers are turning to aluminum-body vehicles
                                                            • The Consumer – What You Need to Know

                                                              • Most consumers have at least one vehicle in their home
                                                                • Nearly two thirds plan on purchasing a car in the next three years
                                                                  • Men lean towards new cars while women slightly over-index for used
                                                                    • Sedans and SUVs top the list for next purchase
                                                                      • Most plan on financing their next vehicle
                                                                        • Reliability tops the list for new vehicle features, particularly among over-45s
                                                                          • Interest in safety features is more prominent
                                                                          • Current Car Ownership and Future Plans

                                                                            • The vast majority of consumers have at least one vehicle in their homes
                                                                              • Figure 13: Vehicles in the household, October 2016
                                                                            • Nearly two thirds plan on purchasing a car within the next three years
                                                                              • Figure 14: Vehicle purchase plan, October 2016
                                                                            • Chinese Canadians are keen to purchase a vehicle in the near future
                                                                              • Figure 15: Vehicle purchase plan, Chinese Canadians vs overall population, October 2016
                                                                            • Men lean towards new cars while more women are unsure
                                                                              • Figure 16: Kind of vehicle considered for next purchase, by gender, October 2016
                                                                          • Types of Vehicles Considered

                                                                            • Sedans and SUVs top the list for next purchase
                                                                              • Figure 17: Type of vehicle considered, October 2016
                                                                            • Men more likely to consider most vehicles, except for crossovers
                                                                              • Figure 18: Type of vehicle considered (select), by gender, October 2016
                                                                            • Very young men are more inclined to consider a hybrid/electric vehicle
                                                                              • British Columbians more keen on hybrid/electric vehicles
                                                                                • Figure 19: Type of vehicle considered (select), by province, October 2016
                                                                            • Method of Payment for Next Vehicle

                                                                              • Most plan on financing their next vehicle
                                                                                • Figure 20: Method of payment for next vehicle, October 2016
                                                                              • Younger consumers are more likely to finance and use credit cards
                                                                                • Figure 21: Method of payment for next vehicle, 18-44s vs over-45s, October 2016
                                                                            • Appeal of New Vehicle Features

                                                                              • Reliability tops the list for new vehicle features, especially among over-45s
                                                                                • Figure 22: new vehicle features (top three), 18-44s vs over-45s, October 2016
                                                                              • No maintenance needed car ownership is appealing to women
                                                                                • Younger cohorts lean towards the newest models and tech features
                                                                                  • Figure 23: New vehicle features (select), 18-44s vs over-45s, October 2016
                                                                              • Interest in Technology and Safety Features

                                                                                • Interest in safety features is more prominent
                                                                                  • Figure 24: Interest in safety features, October 2016
                                                                                • The vast majority of consumers are interested in a GPS
                                                                                  • Figure 25: Interest in technology features, October 2016
                                                                                • In-car entertainment keep the kids occupied
                                                                                • Appendix – Data Sources and Abbreviations

                                                                                  • Data sources
                                                                                    • Consumer survey data
                                                                                      • Consumer qualitative research
                                                                                        • Abbreviations and terms
                                                                                          • Abbreviations

                                                                                          New Cars - Canada - November 2016

                                                                                          US $3,995.00 (Excl.Tax)