Manufacturing shipments fell in January as the auto sector pulled down overall numbers, despite strength in several resource-based industries, Statistics Canada said today.

Shipments slipped 0.7% to $51.8 billion in January, following a 1.8% rise advance in December.

A substantial drop in motor vehicle and parts manufacturing largely contributed to January’s weakness, the agency said.

With those out of the mix, shipments actually edged up by 0.3%.

The report said the manufacturing sector has been volatile for 18 months, with some key industries struggling while others expanded to meet strong global demand.

The slip in January shipments hit only seven of the 21 manufacturing industries, although these industries accounted for just over one-half of the value of total shipments.

Seven provinces posted decreases in January, Ontario was hardest hit, with shipments off by $554 million or 2.1%.

Quebec’s manufacturers reported growth of $146 million or 1.2% to partly offset the decline.

In the auto sector, temporary plant closures and production slowdowns at some factories in January contributed to declines in the manufacturing of motor vehicles and parts. Vehicle shipments fell by 4.6%, to $5.4 billion, the third decrease in a row.

Parts makers lost most of the gains they made in December with shipments down 7.6% to $2.6 billion.

The statistics agency said the Canadian auto sector has been pummelled by a variety of problems, including soaring gas prices, fickle consumers and lagging sales.

Despite January’s overall decrease overall, the majority of industries posted higher shipments.

Robust global demand and soaring industrial prices fuelled a 4.8% jump in shipments of primary metals to $4.2 billion.

Above-average winter temperatures led to increased construction in North America and a consequent rise in the price of lumber.

Shipments of wood products rose 1.8% to $3 billion in January, the highest level since May 2005.

Manufacturers’ inventories continued to accumulate in January, rising 0.3% to $66.3 billion at month’s end. Inventories have been on a gradual rise for about two years.

Unfilled orders rose 1% to $43.2 billion in January, the fourth successive increase. As a result, the backlog of unfilled orders stood at $43.3 billion, the highest level since November 2002.

Following a surge in December, manufacturers’ level of new orders remained stable at $52.2 billion in January. Extensive decreases in the transportation equipment sector offset advances in new orders for fabricated metals products, primary metals and machinery.