Actually, car sales in Kelowna aren't in the ditch

Jordan Kot sees the erratic Kelowna car buying psyche first hand.

"I'd say it's really brand specific," said the vice-president of Kot Auto Group, which has 11 dealerships across BC, including Kelowna Hyundai, Kelowna Kia, Buy Direct Truck Centre, Genesis Kelowna and Okanagan Chrysler Jeep Dodge.

"Our Hyundai and Kia dealerships are okay because Hyundai and Kia are not built in the US. They are well-known South Korean brands. But the brands that people associate with America -- like our Chrysler, Jeep, Dodge and Ram are down significantly. I'd say sales at Okanagan Chrysler Jeep Dodge are down 30% to 40%. It's not falling apart, but it's been hard hit."

The disparity is ironic, because the trade war US tariffs potential car buyers are afraid of haven't even come to fruition.

There are no price increases on American models right now.

If the tariffs do come through, it would mean a 12% to 13% increase in prices on US-made vehicles in the fall.

"Fall is a long way off," said Kot.

"I think the Canadian government and (US President Donald) Trump will figure something out and we may not have tariffs at all."

Be that as it may, potential car buyers can be fearful because of all the uncertainty.

"Yes, there are a lot of unknowns," admits Kot.

"But, I don't think it's as bad as everyone is fearing. I tend to be more optimistic and I think everything is going to be just fine."

As such, car sales are a good indicator of what else is going on in the economy.

If people are buying big-ticket items, there has to be an air of consumer confidence.

Over at Sentes Automotive -- which has the Kelowna Nissan, Kelowna Mercedes-Benz, Lexus of Kelowna and Kelowna Infiniti dealerships -- there is also optimism.

"Some vehicles are made in the US, others are not, and the same goes for auto parts," said Sentes director of operations Pamela Pearson, who is also a past-president of the Kelowna Chamber of Commerce.

"Nissan is up 3.8% in Q1, Lexus is just killing it, Mercedes did well and sales of the Infiniti QX80 (the hot, full-size, luxury SUV priced at over $100,000) have seen a 64% increase."

Pearson acknowledges that some of those brisk sales may be people buying before any US tariffs kick in.

But, people may also be buoyed that interest rates are coming down and all the despondency about the economy doesn't seem to be materializing.

BC is expected to see modest growth next year of 1.1%, which is much better than the recession many were fretting about.

"I'm positive," said Pearson.

"Often the media is negative. But seeing positivity is good. There's not as much doom and gloom out there as everyone feared and I think that puts people at easy and let's them go ahead and do what they would regularly do. No more sitting on the fence."

The New Car Dealers Association of BC uses Desrosiers Automotive Reports to track sales in the province.

In March of this year, there were 18,692 new vehicle sales, up 2% from March 2024.

For the first three months of the year, sales hit 48,215, up slightly from 47,583 over the same period last year.

"Our members (the association represents 400 dealerships in BC) are saying despite the black clouds, people are still coming in and buying," said New Car Dealers Association CEO Blair Qualey.

"So, generally, it's not bad. I mean, we're not blowing the doors off, but we're not going in the ditch, either. In a world of craziness, just okay is good. We'll take that."

As Kot and Pearson pointed out, Qualey reiterates that not all cars are made in the US, so US tariffs will affect the price of all vehicles.

But he does admit that tariffed new cars could be about 12.5% more come later this year.

"So, it's wait and see for most dealerships on that," said Qualey.

"But, remember, there are lots of cars made in Europe and Japan and South Korea and Mexico that will have no tariffs."

In summary, Qualey stated that new car dealers are smart and resilient and hardworking and they get through every situation.

"We made it through COVID and we made it through the recession of 2008-09. We'll make it through this."