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Manufacturing sales drop 1.5% in September 2015


Mfg sales Sep15Ottawa – Manufacturing sales declined 1.5% to $51.1 billion in September 2015, following a 0.6% decrease in August. Lower sales in the motor vehicle assembly and the petroleum and coal product industries were responsible for the decline.

Sales were down in 13 of 21 industries, representing 78.6% of Canadian manufacturing.

Constant dollar manufacturing sales were down 1.6%, indicating that the volume of goods sold was lower in September.

Lower sales of motor vehicles and petroleum and coal products

In the motor vehicle assembly industry, sales fell 10.3% to $5.0 billion in September following four months of gains. In August, sales had reached $5.6 billion, their highest level since March 2007. The decline in September mostly reflected lower numbers of vehicles produced. In contrast to the motor vehicle assembly industry, sales in the motor vehicle parts industry edged down 0.1% in September.

Sales in the petroleum and coal product industry were down 7.1% to $4.8 billion in September, the fourth consecutive decline. The decrease largely reflected partial shutdowns at a number of refineries during the month for maintenance work. Although refineries often shut down for part of September, this year the shutdowns were more extensive than usual. Prices for refined petroleum products declined 4.0%, according to the Industrial Product Price Index.

Higher sales in the machinery and primary metal industries offset some of the declines. In the machinery industry, sales rose 9.6% to $2.9 billion as a result of widespread gains. Primary metal sales were up 4.3%, also as a result of numerous gains.

Sales decline in Ontario

Sales decreased in four provinces in September, with the largest decline in Ontario.

In Ontario, sales were down 2.5% to $24.4 billion. The decrease stemmed mostly from a 10.1% drop in motor vehicle assembly sales and a 7.1% decline in the petroleum and coal product industry. These decreases were partly offset by a 13.1% advance in machinery sales.

Sales in Quebec declined 1.0% to $12.0 billion in September, the third consecutive monthly decrease. The petroleum and coal product industry posted the largest decline. Sales of aerospace product and parts, chemicals and fabricated metal products also fell. Lower sales in these industries were partly offset by a 10.2% gain in the primary metal industry.

Alberta manufacturing sales decreased 1.4% to $5.7 billion in September, the third consecutive monthly decline. The decrease was due to a 10.6% drop in petroleum and coal product sales. Higher sales (+13.0%) in the machinery industry offset some of the decrease.

Inventories decrease

Manufacturing inventories were down 0.4% to $73.0 billion in September. Inventory levels decreased 4.2% in the petroleum and coal product industry and 2.6% in the primary metal industry. Inventories of machinery (-2.0%) also declined. Inventory levels rose in the aerospace product and parts (+1.4%) and motor vehicle assembly (+5.7%) industries.

The inventory-to-sales ratio rose from 1.41 in August to 1.43 in September. The inventory-to-sales ratio measures the time, in months, that would be required to exhaust inventories if sales were to remain at their current level.

Unfilled orders decline

Unfilled orders decreased 0.7% to $96.1 billion in September, as a result of a 0.9% decline in the transportation equipment industry.

Aerospace unfilled orders decreased 0.7% to $52.8 billion, despite an increase in the value of the US dollar relative to the Canadian dollar. A substantial portion of aerospace unfilled orders are held in US dollars. Unfilled orders were also down in the other transportation equipment industry and the railroad rolling stock industry.


Bill Roebuck

Bill Roebuck

Bill Roebuck is the Editor and Associate Publisher of Machinery & Equipment MRO magazine and mromagazine.com.
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