Canadians bought less in May than they did in April, new data from Statistics Canada showed on Thursday — and one of the factors behind a drop in retail sales was a fall in motor vehicle sales.
Retail sales in Canada fell 1.1 per cent in May to $69.2 billion.
Core retail sales, which exclude gasoline stations, fuel vendors, motor vehicle and parts dealers, were relatively unchanged in May, the report said. The report said the drop in sales was, in part, due to “the effects of trade tensions between Canada and the United States on Canadian retail businesses.”
Canada’s auto industry seems to have taken the brunt of falling retail sales, with motor vehicles and parts dealers recording a drop of 3.6 per cent in retail sales in May. The drop was even starker when it came to new car dealerships, which saw sales fall by 4.6 per cent.
This was the first time since February that Canada saw sales at new car dealerships decline, Statistics Canada said.
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Sales at gasoline stations and fuel vendors declined for the third consecutive month, down 1.4 per cent in May. However, car accessories and tire retailers saw sales jump 1.7 per cent, being the only segment of the auto industry that saw higher sales in May.
Canada’s inflation rate climbs to 1.9%
Core retail sales unchanged
Aside from food and beverage sales, core retail sales in Canada were relatively unchanged in May.
Beverage sales in Canada fell 1.2 per cent, declining for the third month in a row.
Beer, wine and liquor retailers saw the biggest drop in this subsector within this sector, with sales falling 2.9 per cent. Supermarkets and grocery stores saw a decline of 0.6 per cent in sales.
As the weather warms up all over Canada, the largest increase in core retail sales in May came from building material and garden equipment and supplies dealers. This segment saw sales rise 1.9 per cent in May, followed by a 0.3 per cent decline in April.
Sales were also up at health and personal care retailers by 0.7 per cent in May. This was the 11th consecutive month of gains in the subsector.
In May, Canadians did not shop online as much as they did in April, as e-commerce sales declined 1.7 per cent to $4.3 billion.
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