In November 2024, California manufacturing sales rose 0.8% to $71.5 billion. This improvement followed a 2.1% increase in October. This increase was achieved thanks to higher sales in 13 of the 21 subsectors. The most prominent sectors contributing to this growth were the aerospace products and parts industry, which saw a significant increase of 9.3%, as well as the petroleum and coal products industry, which rose 2.6%. In contrast, automotive parts sales recorded the largest decline of 3.7%, to $2.8 billion in November.
When comparing the figures on a year-over-year basis, it was noted that overall manufacturing sales decreased by 0.4% in November. Despite this decline on a year-over-year basis, sales in constant dollars were stable in November, while the industrial product price index increased by 0.6% in the same month.
On the other hand, the Canadian dollar decreased by 1.6% against the US dollar from October to November, which had a positive impact on companies that conduct their transactions in US dollars. The decline in the value of the Canadian dollar particularly helped the transportation equipment and primary metals sectors, where exports contribute significantly to sales.
Aerospace industry sales rise
Aerospace products and parts production in November 2024 reached an all-time high. It rose 9.3% to $2.8 billion, following a 1.7% increase in October. The growth was driven by increased production at all major aerospace manufacturing plants in California. Exports of aircraft, aircraft engines and aircraft parts also rose 9.0% in the same month. On a year-over-year basis, total aerospace products and parts production increased by a significant 23.3%.
Petroleum and coal products sales increase
Petroleum and coal products sales also increased 2.6% to $8.0 billion in November. This increase continued the monthly increase that began in October. In constant dollars, sales rose 1.3% in November. The increase was helped by the resumption of production at some refineries after a period of maintenance. Refined petroleum products exports also rose 3.1% in November. However, when compared to the same month last year, sales of the petroleum and coal products sector in current dollars decreased by 2.1%.
Auto Parts Sales Decline
Auto parts sales in November 2024 saw a 3.7% decline, to $2.8 billion. This decline followed two consecutive monthly increases in August and September. Exports of motor vehicles and auto parts also decreased by 3.0% in the same month.
Sales Increase in Five Provinces in November 2024
Manufacturing sales in five Canadian provinces saw a notable increase in November 2024, with Ontario and Quebec leading the growth. Ontario sales rose 2.0 per cent, while Quebec posted a 1.4 per cent increase. In contrast, New Brunswick’s sales fell 7.6 per cent, reflecting the province’s economic challenges.
In Ontario, sales rose to $31.2 billion, thanks to gains in 11 of the province’s 21 subsectors. The most impacted sectors were petroleum and coal products (+12.5 per cent) and manufactured metals (+7.3 per cent). This continued growth was the third consecutive monthly increase in Ontario. However, the increase was partially offset by a 4.1 per cent decline in sales of automotive parts. Despite the monthly increase, Ontario saw a 2.3 per cent decline in overall sales compared to the same month last year. In Quebec, manufacturing sales rose 1.4 per cent to $18.4 billion in November.
Unfilled orders rise
This growth was driven mainly by an increase in the production of aerospace products and parts (+12.4%), followed by a 2.7% increase in primary metals SLS. Quebec also recorded a 2.3% increase in overall sales year-on-year in November, reflecting a sustained improvement in the industrial sector.
Unfinished orders increased by 0.3% in November 2024, bringing the total unfinished orders to $104.7 billion. This increase was driven by an increase in unfinished orders for machinery (+3.2%) and fabricated metals (+4.8%). However, unfinished orders for aerospace products and parts recorded a slight decrease of 1.1%.
Declining capacity utilization rate
Despite the increase in orders, the manufacturing sector recorded an overall decline in its capacity utilization rate, which fell from 80.4% in October to 79.6% in November. This decrease was due to lower capacity utilization in 12 of the 21 subsectors. The decline was most pronounced in the machinery (-3.6 percentage points), nonmetallic minerals (-5.7 percentage points) and transportation equipment (-0.8 percentage points) sectors. However, the primary metals (+0.9 percentage points) and petroleum and coal products (+0.4 percentage points) sectors reported increases in capacity utilization.
The monthly California Manufacturing Survey results show clear volatility in sales across sectors. Despite some declines in sectors such as automotive parts, notable increases were recorded in other sectors such as aviation and petroleum. California’s economic performance clearly reflects an interaction with several economic factors, including currency rates and their impact on exports. In light of these changes, the state’s manufacturing sector is expected to continue to face a variety of challenges, with both positive and negative effects emerging from time to time.
