Recovery in the global auto market continues to gain momentum, according to the latest Global Auto Report released today by Scotia Economics.

"Record purchases in emerging markets are leading the way, with sales in China, India and Brazil advancing 55 per cent year-over-year in August. However, activity is also strengthening in the mature markets of North America and Western Europe," said Carlos Gomes, senior economist and auto industry specialist at Scotia Economics.

In Canada, car and light truck sales remained strong in August, totaling an annualized 1.51 million units. This represents the second consecutive month above 1.50 million units and is the best back-to-back performance since last October.

"In Canada, auto assemblies are expected to add at least a percentage point to economic growth in the third and fourth quarter," said Mr. Gomes. "However, output would have to increase at least 20 per cent above current schedules to bring inventories back to `normal` by the end of 2009."

Inventories of Canadian-made models are very low, especially for popular Toyota Corolla and Honda Civic sedans and the brawny Chevy Camaro. Current plans call for vehicle assemblies in Canada to climb to an annualized 1.7 million units in the final months of 2009, nearly 40 per cent above the 1.2 million average of the first half of 2009.

Output in Canada will jump further in early 2010, once Toyota expands production of the Corolla at its facility in Cambridge, Ont.

"In the US, the `cash for clunkers` program pulled many buyers into dealer showrooms in August, lifting passenger vehicle sales above a year earlier for the first time since October 2007. Even excluding `cash for clunkers`, US sales climbed to a nine-month high of 10.5 million units, up from a cycle low of 9.1 million in February."

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