Ontario, Quebec lead manufacturing rebound in May
- July 15, 2020
Even though many manufacturers resumed operations following full or partial shutdowns related to COVID-19 during the previous month, total manufacturing sales in May were 28.4 per cent below their pre-pandemic level in February.
Sales were up in 18 of 21 industries, led by motor vehicle, motor vehicle parts and petroleum and coal products industries.
In volumes terms, manufacturing sales rose 8.8 per cent, indicating a higher volume of products sold in May.
Four-fifths (80.9 per cent) of establishments in the manufacturing sector reported that their activities were affected by COVID-19, but only 24.3 per cent of establishments reported having a recovery plan in place.
The largest estimated impacts of COVID-19 on manufacturing sales in dollar terms were in the transportation equipment (-$6.7 billion), petroleum and coal product (-$1.8 billion), fabricated metal product (-$836 million), food (-$806 million), plastic and rubber product (-$791 million), machinery (-$760 million) and primary metal (-$710 million) industries.
Sales in the transportation equipment industry rose 81.7 per cent to $3.6 billion in May, partially recovering from the record 74.9 per cent drop in April. The largest increases were in the motor vehicle (+$983.5 million) and motor vehicle parts (+$439.8 million) industries, as most plants re-opened and gradually resumed production by mid-May. Despite this monthly increase, sales of motor vehicles and parts were down 79.1 per cent compared with May 2019.
Sales of fabricated metal products rose 14.8 per cent to $2.7 billion in May following two consecutive monthly decreases. The gains were widespread but more pronounced in the architectural and structural metal industry.
Machinery and paper sales decline
Machinery sales were down for the fourth consecutive month, declining 6.9 per cent to $2.6 billion in May. Many machinery manufacturers indicated that they experienced lower demand as some customers postponed some orders due to COVID-19. In May, declines were mostly concentrated in commercial and service industry machinery.
Ontario and Quebec lead the gains
Sales increased in eight provinces in May, led by Ontario and Quebec.
Following a record 37.0 per cent decline in April, manufacturing sales in Ontario rose 17.5 per cent to $16.4 billion, mostly reflecting higher sales of motor vehicles (+$958.9 million) and motor vehicle parts (+$421.4 million).
In Quebec, sales rose 9.1 per cent to $10.6 billion in May, following a 25.1 per cent decline in April. Sales increased in 17 of 21 industries, led by the fabricated metal product (+37.9 per cent), wood product (+43.3 per cent), furniture and related product (+108.0 per cent) and transportation equipment (+18.2 per cent) industries.