North America Production Down 4.3% in 2017

North American automakers built 16,971,518 light vehicles in 2017, a 4.3% decrease from 2016’s production record of 17,729,618. For the month, production slowed 11.1% to 1,130,339 LVs, the lowest December total since 2010.

Much of the slowdown came from car production, which shrank 15.3% to 5,683,233 for the year, and fell 4.4% points to 32.6% share of the light-vehicle total. Mirroring the vehicle-type splits in sales trends, light-truck output rose 2.5% to 11,288,285 units.

Automakers in the U.S. pulled back production 15.0% in December, bringing the annual total down 8.6% to 10,890,558 LVs.

BMW output fell 9.7% to 371,284 for the year. Hyundai dropped 13.4% to 328,400 and Nissan was down 7.6% to 930,586 in the U.S.

However, Subaru builds rose 9.2% to 363,414 units, the manufacturer’s highest annual total since starting production in Lafayette, IN, in 1989. The Impreza, which began production in late 2016 with 13,399 units, soared to 109,038 in 2017.

Tesla increased production an estimated 20% to more than 100,000 units for the year. Production of the company’s first mass-market electric sedan, the Model 3, began over the summer, but volumes came in lower than expected. Assembly line workers reported high off-line repair rates and other manufacturing snags at the Fremont, CA, site.

Production in Canada also was sluggish, falling 9.3% in December and down 7.5% for the year with 2,179,676 builds. Both car (-6.7%) and light-truck (-7.9%) output decreased from 2016.

Ford production fell 6.4% to 254,025 and Toyota tumbled 5.0% to 571,537 from their Canada plants.

Going against the current, Honda’s Canada total was up 4.4% to 429,268. The CR-V, which also was built at two sites in the U.S., rose 7.0% to 219,860 units.

In contrast to the rest of the region and despite a flat December (+0.9%), Mexico production grew 12.8% to 3,901,284 LVs for the year. A 95.2% increase in CUV production boosted light-truck output 36.7% to 2,001,255 units, while car output declined 4.7% to 1,900,029.

Several manufacturers moved production of individual models to Mexico in 2017, accelerating the growth. The Jeep Compass moved from Belvidere, IL at the end of 2016 down to Toluca, Mexico. The Chevy Equinox and GMC Terrain started production in Mexico, while still being built in Canada, though at lower volumes. Kia began assembly of the Rio and Hyundai Accent in Mexico, and Volkswagen started Tiguan and Audi Q5 production there, too.

Nissan (-26.7%) and Mazda (-16.54%) were among the few automakers to see a decrease in Mexico production.

Mexico surpassed Canada in light-vehicle volume in 2008, and Canada has not since regained the 2.5 million level seen in 2007 while Mexico’s total continues to rise. The U.S. is feeling the effects, too, dropping to 64.2% share of the region in 2017 after holding 67% the previous four years.

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