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OADA Web Presentation

Plus hundreds of other Gold and Silver Online-dealers across Canada ... The Scotiabank Group, Toronto. Presentation to: Ontario Automobile. Dealers Association ...

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OADA Web Presentation

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    Slide 1:OADA Web Presentation Economic and Auto Outlook 2009

    Presented by Carlos Gomes Senior Economist, Scotiabank Sponsored by LeaseBusters

    Canada’s Lease-Take-Over Pioneers Canada’s # 1 Lease-Take-Over marketplace Have you ever ‘walked’ a customer who wanted to buy a new vehicle but was stuck in a lease? Is your competition selling cars to these customers? How are they making deals when your sales staff felt that they were ‘too upside-down’? Leasebusters.com gets 300,000 visitors to our website every month who are looking for these types of leases!!! These are YOUR customers. Please; don’t give them up to anyone!!! We have customers looking for short term leases. You have customers who would make a new car deal if you could get them out of their lease! Working together by transferring leases will ‘shorten the trade cycle’ and help you sell more new vehicles!!! Leasebusters dealer programs allow you have complete control of the lease transfer process GUARANTEEING that you will sell YOUR customer their next vehicle!!!!! Here’s just a sampling of the successful Online-Dealers working with Leasebusters.com Ready Honda, Mississauga, ON Oakridge Ford, London, ON Ontario Chrysler, Mississauga, ON Toronto Honda, Toronto, ON Avante Mazda, Richmond Hill, ON Ken Shaw Lexus Toyota, Toronto, ON Mississauga Honda, Mississauga, ON Camco Acura, Ottawa, ON ToyotaTown/Lexus of London, London, ON Town & Country BMW, Thornhill, ON Roy Foss Chevrolet, Woodbridge, ON Lally Ford, Tilbury, ON Acura West, London, ON Myers Cadillac Chevrolet, Ottawa, ON Mazda of Toronto, Toronto, ON Sherway Nissan, Toronto, ON Gus Brown Pontiac Buick, Whitby, ON Plus hundreds of other Gold and Silver Online-dealers across Canada Find out how YOU can join these Online-dealers who sell more new and used vehicles and participate in our lead generation program!!! Call 1-888-357-2678…TODAY and ask about our OADA approved dealer programs! Carlos Gomes Senior Economist Industry Research The Scotiabank Group, Toronto Presentation to: Ontario Automobile Dealers Association Toronto, Ontario April 7, 2009 Economic & Auto Industry Outlook: 2009 Searching for a Bottom Global Economic Growth United States & Western Europe yr/yr % change yr/yr % change Global Growth Global Growth Moderates U.S. Real GDP Euro-zone Real GDP Emerging Markets Gradual Improvement in Assemblies to Begin by Spring New Domestics to Surpass Detroit Three Output in Early 2009 millions of units North American Vehicle Production Sharp Inventory Adjustment New Domestics Detroit Three U.S. Dealer Inventories days’ supply millions of units forecast North American Vehicle Production

    Slide 12:Boom, Bust, and Early Stabilization

    U.S. Home Sales (LHS) index Coincidence to Lagging Ratio (RHS) ISM (RHS) index millions of units Baltic Dry Index (LHS) U.S. Housing & Manufacturing Key Leading Indicators index

    Canadian Economy Slows… yr/yr % change Manufacturing – Canada (LHS) Services – Canada (RHS) Manufacturing Leads Slowdown yr/yr % change Employment – Canada (RHS) … Lifting Unemployment % Unemployment Rate – Ontario Unemployment Rate – Canada U.S. Affordability Remains Strained yr/yr % change U.S. Housing Affordability Index U.S. Median House Prices U.S. House Prices Decline Spreads index International House Prices U.K. House Prices Canada – MLS Prices yr/yr % change Ontario – MLS Prices U.S. Housing Recession Plunging U.S. Home Sales … mn units New Home Sales Existing Home Sales mn units months’ supply Existing Home Sales … And Soaring Inventories New Home Sales Balanced Market

    Slide 16:Low Rates For a Long Time

    Canada 10-yr Gov’t. Bond U.S. 10-yr T-Bond % Canada-U.S. Bond Spread Canada U.S. Canada-U.S. Central Bank Spread % Source: Bank of Canada; Federal Reserve; Global Insight; Scotia Economics Central Bank Rates Canadian & U.S. Bond Yields

    U.S. Real Fed Funds & Financial Stress % Ted Spread U.S. Real Fed Funds Financial Conditions Begin To Ease U.S. Real Fed Funds & Real GDP yr/yr % change % %

    Slide 17:For recession periods, 0.01” = one month of recession (in formatting section of gray bars) DEC69-NOV70; NOV73-MAR75; JAN80-JULY80; JULY81-NOV82; JULY90-MAR91; MAR01-NOV01For recession periods, 0.01” = one month of recession (in formatting section of gray bars) DEC69-NOV70; NOV73-MAR75; JAN80-JULY80; JULY81-NOV82; JULY90-MAR91; MAR01-NOV01

    Slide 18:Financial Stress/Event Risk In Financial Markets

    Franklin National First Penn Drysdale Securities/Mexican Default Continental Illinois Black Monday S&L Crisis Peso Crisis Asian Currency Crisis LTCM/Russia Default NASDAQ Bubble Subprime Meltdown Penn Central Ted Spread % Gulf War Y2K Silver Bubble Latin American Debt Crisis Ted Spread is a three month LIBOR minus three month T-bills Lehman Bros Transportation Equipment ex. Autos & Parts - NeilTransportation Equipment ex. Autos & Parts - Neil

    Slide 19:Boom, Bust, and Stabilization

    S&P 500 (LHS) S&P/TSX (RHS) TED Spread (LHS) Emerging Markets (LHS) index Emerging Markets (RHS) Stocks Stress index index %

    Slide 20:Fiscal Stimulus To The Rescue

    Coordinated Fiscal Stimulus % of GDP Source: OECD, IMF, BNS. Timing of Package 2010 2009 2008

    Slide 21:Canadian Households in Better Shape

    Canada U.S. % of household real estate Canada U.S. Household Debt % of household assets Household Equity

    United States millions of units Auto Sales Housing Starts Auto & Housing Cycles millions of units Canada thousands of units Auto Sales Housing Starts thousands of units Buying Plans & Vehicle Sales % yr/yr % change Employment & Vehicle Sales millions of units millions of units Employment Growth & Confidence Drive Vehicle Sales New Car Prices Decline U.S. New Car Prices & Employment yr/yr% change U.S. Car Prices U.S. Private Sector Employment Canadian Dollar & New Vehicle Prices 000’s of U.S. dollars Canadian Dollar Vehicle Prices CAD/USD 08 07 06 05 09 Used Vehicle Imports Moderate, Supporting Prices Vehicle Imports Surge as C$ Strengthens Used Car Prices are Under Pressure yr/yr% change thousands of units Vehicle Imports Scotiabank Used Car Price Index – One-Year Old Models Canadian Dollar US cents Manheim Used Vehicle Index – United States

    Slide 25:Updated march 26 07Updated march 26 07

    Canada’s Vehicle Fleet… per cent of total fleet Vehicles 4 Years or Less Vehicles 9 Years or Older Source: R.L. Polk & Co and Desrosiers Automotive Consultants Canada Vehicle Fleet Ontario’s Vehicle Fleet % of total fleet Vehicles 4 Years or Less Vehicles 9 Years or Older Ontario Vehicle Fleet Ontario’s Aging Fleet … ... Has Many Vehicles At Least 11 Years Old Vehicles 11 Years or Older millions of units Vehicles 9 Years or Older Vehicles 4 Years or Less millions of units Source: R.L. Polk & Co and Desrosiers Automotive Consultants Small Cars Dominate The Canadian Markets … thousands of units Medium Cars Small Cars … But Crossover Utility Vehicles Are Growing Rapidly thousands of units CUVs SUVs New Vehicle Market -- Canada Pickup Trucks Ontario Automobile Sales thousands of units Ontario Vehicle Sales – An Historical Perspective forecast This Report is prepared by Scotia Economics as a resource for the clients of Scotiabank and Scotia Capital. While the information is from sources believed reliable, neither the information nor the forecast shall be taken as a representation for which The Bank of Nova Scotia or Scotia Capital Inc. or any of their employees incur responsibility. Carlos Gomes Senior Economist Industry Research The Scotiabank Group, Toronto Presentation to: Ontario Automobile Dealers Association Toronto, Ontario April 7, 2009 Economic & Auto Industry Outlook: 2009 Searching for a Bottom
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