TORONTO -

As panelists emphasized at the recent Auto Remarketing Canada conference presented by CarProof, supply is tight for dealers in Canada.

And that’s impacting everything from retail pricing and wholesale costs to sourcing strategies and dealer grosses.

“Historically, we know what happened back in ’08 and ’09: there just weren’t any new cars. As a result, those cars could never be turned into used cars,” Brian Murphy — senior manager for the Power Information Network in Canada for J.D. Power and Associates — told Auto Remarketing Canada on site at the event.

In fact, data shared by Murphy indicates that Canadian new-vehicle sales fell 12 percent between 2006 and 2009. This has reduced used supply and led to higher used prices, among other impacts.

In talking with Auto Remarketing Canada, Murphy delved into some of the “other indicators” beyond the used supply numbers, pointing out that “prices (are) being driven up slightly; the cost of the car is being driven up quite a bit, and as a result, dealers’ grosses are getting pinched.”

Compounding this problem is something Murphy has observed about cross-border shopping into the U.S.

“It was quite a viable solution for a Canadian retailer, if he needs a car, to just go get it from the U.S. auction. But the U.S. is in a worse circumstance,” he added. “So, what we might actually see is the U.S. retailers coming to Canada to get cars.”

But it wasn’t all bad news on the supply front.

“We’re also tracking through the PIN data an increase in the number of trade-ins that people are coming with,” said Ryan Robinson, director of the Canadian Automotive Practice at J.D. Power.

“I think the upshot to all of this is that dealers just have to be a little bit more careful about and think about where they’re getting their cars from,” Robinson added, emphasizing the importance of being “smarter in sourcing” these vehicles.

“There are less of them out there,” Robinson said, referring to high-quality used units, “but they’re still out there.”

Editor’s Note: Stay tuned to Auto Remarketing Canada, as we continue to explore the used-car supply dynamic through stories featuring insight from Canadian used-car and remarketing leaders.