OTTAWA, Ont. — The volatile motor vehicle industry, which comprised approximately 12% of total shipments in August, once again topped the manufacturing sector in terms of shipment activity. Motor vehicle manufacturers posted stronger-than-normal gains in shipments of 10.5% to $6.1 billion in August, Statistics Canada reports.

“Several automobile manufacturers were in full production of the 2006 models to stock showrooms in the fall. In addition, August’s rebound in motor vehicle manufacturing followed a notably weak July when assembly lines were slowed due to seasonal shutdowns for employees’ vacations and product changeovers, along with extended production slowdowns at some plants for inventory control measures,” Statistics Canada commented in its Daily Bulletin.

Strong demand and a 6.5% jump in the price of petroleum and coal products pushed shipments above the $5 billion mark for the first time.

Unplanned refinery closures and the threat of tropical storms in the southern United States set in motion the recent surge in the price of crude oil in August. By month’s end, the price of crude oil surpassed US $70 per barrel, the highest on record, as Hurricane Katrina battered the US Gulf Coast. Petroleum shipments have risen almost 30% in value since the close of 2004.

A decline in the production of aerospace products and parts in August (-29.1%) slightly offset the overall rise in shipments. Despite the drop, healthy foreign demand has been fuelling a recovery in the aerospace industry in 2005.

Although August’s gain in shipments was concentrated in the price-influenced petroleum industry and the volatile transportation equipment sector, the spurt of activity on the factory floor was wide ranging. Increases were reported in 16 of 21 manufacturing industries, accounting for almost 90% of total shipments.

Excluding the motor vehicle, parts and petroleum industries, shipments remained up a healthy 1.1%. Both the durable goods (+2.7%) and nondurable goods (+4.2%) sectors fuelled August’s gain in manufacturing.

The marked increase in manufacturing activity in August contributed to an improvement in the trend for shipments. Although higher industrial prices were a factor in the rise of shipments in August, a share of the increase was volume based as shipments jumped 3.6% to $48.1 billion at 1997 prices.