Market Snapshot: Passenger vehicle annual export value in 2015 surpasses crude oil for first time since 2007

Release Date: 2016-02-10

In 2015 passenger vehicle exports reached $57.8 billion, slightly above the $56.7 billion value of crude oil exports. This led to passenger vehicle exports reclaiming its position as Canada’s most valuable export, a position it held from at least 1988 to 2007Footnote 1.

Source and Description

Source: CANSIM Table 228-0059

Description: This figure uses a line chart to compare the monthly value of Canadian crude exports to the value of passenger vehicle exports from 2000 to 2015. Crude exports increased from $1.4 billion at the start of 2000 to $8.7 billion in July 2014 and fell sharply to $4.2 billion by December 2015. Passenger vehicle exports decreased from $5.7 billion at the start of 2000 to a low of $1.2 billion in January 2009, and then increased to $6.0 billion in December 2015. Crude oil exports surpassed declining passenger vehicle exports in December 2007, but fell below rising passenger vehicle exports in August 2015.

The cause of crude oil’s declining export value is the fall of crude oil prices.Footnote 2 This has decreased Canada’s terms of trade, a measure of the ratio of export prices relative to import prices, and has far reaching implications for the Canadian economy.

One such implication is the lower Canadian dollar.Footnote 3 In July 2014, when the price of WTI was over $103 per barrel, the Canadian dollar was worth 0.94 USD. By the end of 2015, WTI fell to less than $38 per barrel and the Canadian dollar was worth 0.72 USD.

The depreciated dollar increases the value of Canadian exports priced in U.S. dollars, this has partially mitigated the impact of lower energy prices on Canadian energy producers. The depreciated dollar also tends to increase the attractiveness of non-energy exports. While the export value of energy products fell 52 per cent since March 2014, the value of non-energy exports increased 16 per cent.Footnote 4

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