While the cost of new cars in Canada continues on an upward trend, the used vehicle market is finally starting to cool according to some experts.
As Canada begins to return to a “new normalcy” from the COVID-19 pandemic, demand for vehicles is balancing out and “prices are dipping,” specifically in the used car market, said Dimitry Anastakis, a professor at the University of Toronto’s history department and the Rotman School of Management.
“We’ve had some crazy politics, some crazy economy, some crazy pandemic, some crazy climate change, and all of that has a real impact on cars,” Anastakis told Global News.
Why are the prices of used cars falling?
Vehicle pricing over the past few years has been steep with the industry being hit by global semiconductor chip shortages, exacerbated by the pandemic and Russia‘s war on Ukraine. This left most automotive manufacturers scrambling for parts as they struggled to meet delivery demands for new vehicles. Consequently, prices for used vehicles soared as they were readily available.
However, prices are now slowly on the decline.
“The prices are going down (because) there’s been the lessening of demand,” Anastakis said.
“In the used car market, a key reason prices are going down is that they’ve been so tremendously high since COVID. The auto industry slowed down considerably, which caused a scarcity…so prices went through the roof,” he said. “Now prices are coming down a little bit because some of that pressure has been alleviated.”
Challenges faced by the new car market, including delivery delays, also drove people to choose used vehicles during the pandemic leading to high prices, according to Werner Antweiler, professor of economics at the University of British Columbia’s School of Business.
But now, as also noted by Anastakis, some pandemic obstructions are starting to wear off and demand for used cars is starting to stabilize, Antweiler told Global News. As a result, prices are going down.
“Some of the challenges we saw during the pandemic with deliveries led to people buying more used cars and that has been driving up demand for the lack of supply in the new car market,” he said.
“Now, that is starting to balance out a little bit. It’s getting back to normal, not quite there, but certainly it’s changing in that direction. And so, some of the pressure is coming off the used cars market.”
What about new cars?
In the new vehicle market, prices are seemingly remaining steep, according to Antweiler.
“We had a significant drop in car sales and as a result of the pandemic, we also had significant challenges to our supply chain. All that contributed to driving the prices up and now during the second half of the year, we have also seen interest rates go up,” he said.
And with interest rates on the rise, purchasing a new vehicle is becoming more expensive and slowing down demand because of the need to finance or lease, Antweiler explained.
“Be mindful of interest rates,” he said. “We are still in a landscape where interest rates are going to be high for the remainder of the year. The higher cost from financing has slowed down demand.”
At the end of last month, the Bank of Canada delivered another hike into its key interest rate. The central bank raised the rate to 4.5 per cent, an increase of 25 basis point and the highest the Bank of Canada’s key rate has been since 2007.
Moreover, the chip shortage hasn’t entirely passed either, according to Anastakis, so Canadians can still expect prices of new vehicles to remain high.
“There’s been problems in supply which have really led to cause a spike in prices. One of the reasons chip-making is so important is because it fuels the auto industry and because of that chip demand — which was spiked during COVID, because people wanted to buy more digital devices because they’re all at home — there has been a slowdown,” he said.
“You have your phone and it’s got chips in it, but your car has way more chips and there’s such a big demand.”
A look at the electric vehicles market
When it comes to electric vehicles, prices of some makes are starting to balance out with fuel-run cars, according to Jospia Petrunic, president and CEO of the Canadian Urban Transit Research and Innovation Consortium.
In the U.S., Tesla Inc. recently cut prices by nearly 20 per cent on most of its models in an effort to bolster demand and raise market share.
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Following that decision, Ford also announced it would be slashing prices on its Mustang Mach-E electric SUV by nearly US$6,000.
“It’s not just that automakers woke up and decided to be environmentalists. That’s not what’s happening,” Petrunic told Global News.
Demand for electric vehicles has largely remained low, but inflation has continued to rise, said Petrunic, so electric vehicle makers are trying to get as many consumers to enter the market before they get priced out.
“What they’re trying to do is price slash to get you into the market to buy these electric cars before inflation and recessionary conditions make it totally unlikely and impossible,” she said. “It’s really automakers seeing the writing on the wall.”
In Canada, automakers may receive federal or provincial rebates if their electric vehicle is priced below a certain price. This is also causing costs to drop, according to Petrunic.
‘Way more choice and way more options’
According to Anastakis, the world is at the tip of an “electric vehicle revolution.” With that in mind, he suggests consumers to wait, if they can, before entering the market.
“There’s going to be way more choice and way more options, and they’re going to improve every year,” he said, pointing at the future of electric vehicles. “If you can hold on to your car, hold on to it, because in the next ten years, [electric vehicles] are going to go from about five per cent of the market… to 10 per cent, to 15 per cent, to 20 per cent.”
“It took about 25 years for the automobile revolution the first time around to really figure self out. And we’ve already got a lot of the infrastructure for automobiles because we’re not changing them. We’re just changing the way they’re powered,” he said.
According to Antweiler, “the market is changing because of the transition from combustion engine vehicles to electric vehicles.”
“We expect to see a lot more models coming into the market all year or next as manufacturers are gearing up production of electric vehicles,” he said.
But, the first thing to remember when on the market for any type of vehicle is to shop around, Antweiler added.
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“Compare different manufacturers on models because there are great differences. It’s always very wise to compare and get all the information you can,” he said.
When buying a used car, it’s important to check the vehicle history report, have the car inspected, take it for a test drive and ensure the proper paperwork is completed upon purchasing, according to a 2021 report from Edmunds, an online car shopping guide.
If you are buying a car from an individual owner, make sure the seller properly transfers the title and registration to you. It’s important to close the deal correctly to avoid after-sale hassles,” the report said.
And for those who are entering the market at this time, Petrunic is cautioning about delivery delays on new cars.
“What I do think is probably here to stay for a relatively elongated period of time is the fact that what you buy may not arrive in the next few months of longer term, she said. Car ownership is unpredictable and expensive and who knows how long our economic constraints will last.”
EDMONTON – Ontario country artist Jade Eagleson has won album of the year at the 2024 Canadian Country Music Association Awards in Edmonton.
The singer from Bailieboro, Ont., was up for six awards alongside Alberta’s MacKenzie Porter.
Eagleson took home album of the year for “Do It Anyway” and says he’s thankful to his wife and management team for helping him reach the level he’s at.
The James Barker Band from Woodville, Ont., also won fans’ choice and group of the year at the award show, held in Edmonton.
During their acceptance speech, frontman Barker hinted at new music and a possible tour in 2025.
Another Ontario crooner, Josh Ross, has taken home a trio of awards, receiving entertainer of the year, male artist of the year and single of the year.
He says he and his band play roughly 150 shows every year and are never home, but says taking home entertainer of the year makes the hard work worth it.
Porter took home female artist of the year, ending the five-year streak of Tenille Townes being awarded the coveted hardware.
Porter had been nominated seven times previously for the award in the past decade but hadn’t won until tonight.
The artist from Medicine Hat, Alta., says it takes a lot of hard work and hustle to succeed as a female in the country music industry and gave a shout out to her fellow singers and her newborn daughter.
Joining the two artists in the winners’ circle was Ontario singer-songwriter Owen Riegling, who won for breakthrough artist of the year.
The show began with American artist and co-host Thomas Rhett being dubbed an honorary Canadian by Edmonton Oilers players Corey Perry and Leon Draisaitl.
Rhett donned an Oilers jersey that was gifted to him by the pair.
The return of k.d. lang and the Reclines was expected to be a highlight of the show.
The appearance will mark the first time the Alberta songstress has teamed up with the band in 35 years and is tied to lang’s induction into the Canadian Country Music Hall of Fame.
The awards show is back in Alberta’s capital for the first time since 2014. It was held in Hamilton last year and in Calgary in 2022.
This report by The Canadian Press was first published Sept. 14, 2024.
VANDERHOOF, B.C. – British Columbia Conservatives are promising changes they say will bring more stability to the province’s struggling forest industry.
Leader John Rustad announced his plan for the sector a week before the official launch of the provincial election campaign, saying a Conservative government would do away with stumpage fees paid when timber is harvested and instead put a tax on the final products that are produced.
Rustad said Saturday that under a provincial Conservative government, a small fee may be charged upfront, but the bulk would come at the end of the process, depending on what type of product is created.
He also promised to review how wildfires are managed, as well as streamline the permit process and review what he calls the province’s “uncompetitive cost structure.”
“British Columbia is by far the highest cost producers of any jurisdiction in North America. We need to be able to drive down those costs, so that our forest sector can actually be able to do the reinvestment, to be able to create the jobs and make sure that they’re still there to be able to support our communities,” he said.
The governing New Democrats meanwhile, say eliminating stumpage fees would inflame the softwood lumber dispute with the United States and hurt forestry workers.
In a statement issued by the NDP, Andrew Mercier, the party’s candidate in Langley-Willowbrook, said Rustad failed to support the industry when he was in government under the former BC Liberals.
“Not only will Rustad’s old thinking and recycled ideas fail to deliver, his proposal to eliminate stumpage would inflame the softwood lumber dispute — punishing forestry workers and communities,” Mercier said, accusing Rustad of ignoring the complexity of the challenges facing the industry.
The softwood lumber dispute between the U.S. and Canada stretches back decades. In August, the U.S. Department of Commerce nearly doubled duties on softwood lumber.
International Trade Minister Mary Ng has said Canada has taken steps to launch two legal challenges under the Canada-United States-Mexico Agreement.
Rustad said a provincial Conservative government would push hard to get a deal with the United States over the ongoing dispute “whether it’s with the rest of Canada or by itself.”
He said his party’s proposed changes are in the name of bringing “stability” and “hope” to the industry that has seen multiple closures of mills in rural communities over the last several years.
Most recently, Canfor Corp. decided to shutter two northern British Columbia sawmills earlier this month, leaving hundreds of workers unemployed by the end of the year.
According to the United Steelworkers union, Canfor has closed 10 mills in the province since November 2011, including nine in northern B.C.
Jeff Bromley, chair of the United Steelworkers wood council, said Saturday the idea of changes in favour of taxing the final product has been floated in the past.
He said the finer details of the Conservative plan will be important, but that the system needs to be improved and “new ideas are certainly something I’d be willing to entertain.”
“Something needs to happen, or the industry is just going to bleed and wither away and be a shadow of its former self,” Bromley said.
“Politics aside, if (Rustad) can come up with a policy that enables my members to work, then I would be supportive of that. But then I’m supportive of any government that would come up with policies and fibre for our mills to run. Period.”
When Canfor announced its latest closures, Forests Minister Bruce Ralston said the sector was a “foundational part” of the province and the current NDP government would work to support both local jobs and wood manufacturing operations.
This report by The Canadian Press was first published Sept. 14, 2024
SANTA CLARA, Calif. (AP) — The San Francisco 49ers placed All-Pro running back Christian McCaffrey on injured reserve because of his lingering calf and Achilles tendon injuries.
The move made Saturday means McCaffrey will miss at least four more games after already sitting out the season opener. He is eligible to return for a Thursday night game in Seattle on Oct. 10.
McCaffrey got hurt early in training camp and missed four weeks of practice before returning to the field on a limited basis last week. He was a late scratch for the opener on Monday night against the Jets and now is sidelined again after experiencing pain following practice on Thursday.
McCaffrey led the NFL last season with 2,023 yards from scrimmage and was tied for the league lead with 21 touchdowns, winning AP Offensive Player of the Year.
The Niners made up for McCaffrey’s absence thanks to a strong performance from backup Jordan Mason, who had 28 carries for 147 yards and a touchdown in San Francisco’s 32-19 victory over the New York Jets. Mason is set to start again Sunday at Minnesota.
After missing 23 games because of injuries in his final two full seasons with Carolina, McCaffrey had been healthy the past two seasons.
He missed only one game combined in 2022-23 — a meaningless Week 18 game last season for San Francisco when he had a sore calf. His 798 combined touches from scrimmage in the regular season and playoffs were the third most for any player in a two-year span in the past 10 years.
Now San Francisco will likely rely heavily on Mason, a former undrafted free agent out of Georgia Tech who had 83 carries his first two seasons. He had at least 10 touches just twice before the season opener, when his 28 carries were the most by a 49ers player in a regular-season game since Frank Gore had 31 against Seattle on Oct. 30, 2011.
The Niners also have fourth-round rookie Isaac Guerendo and Patrick Taylor Jr. on the active roster. Guerendo played three offensive snaps with no touches in the opener. Taylor had 65 carries for Green Bay from 2021-23.
San Francisco also elevated safety Tracy Walker III from the practice squad for Sunday’s game against Minnesota.
