08:29 AM EST, 03/05/2025 (MT Newswires) -- Markets are only a few days removed from the end of

February, but already it seems like the distant past, said Bank of Montreal (BMO).

United States new vehicle sales rebounded 3.3% month over month last month to 16.3 million units annualized

after a softer January, noted the bank. That points to some upside to U.S. consumer spending in February

after real personal consumption expenditures fell 0.5% in January.

While Canadian new vehicle sales in February dropped 8.2% year over year, last February was the strongest February of all time, pointed out BMO. At 2.0 million

units annualized, new vehicle sales were on solid footing leading into the trade war with the U.S.

All that momentum to start the year could quickly reverse with U.S. President Donald Trump imposing 25% tariffs on imports from Canada and Mexico on Tuesday, stated BMO. The automotive supply chain is highly integrated across the three countries. Tariffs are likely to lead to significant production curtailments and higher new vehicle prices.

February offered a lesson in what happens to sales when prices rise: in the first full month without Canadian federal and Quebec subsidies, electric vehicle sales sagged.