01/09/2015 02:12 EST | Updated 03/11/2015 05:59 EDT

Canadian auto sales to rise in 2015 thanks to U.S. demand: Scotiabank report

TORONTO - Auto sales in Canada and Mexico this year will top the record-setting pace they set in 2014, according to a Scotiabank report on the global auto industry.

Scotiabank analyst Carlos Gomes predicts Canadian auto sales will rise to 1.86 million vehicles in 2015, from 1.85 million in 2014, while sales in Mexico will total 1.17 million this year, up from 1.13 million.

Meanwhile Americans are expected to buy roughly 17 million new vehicles in 2015, the highest level since 2001, and an increase from 16.4 million last year.

Strong economic growth, improving household finances and aging vehicles in need of replacing will be behind the sales boost in the U.S., according to the report.

Robust U.S. demand will, in turn, improve exports for Canadian and Mexican automakers.

Combined, auto sales in Canada, the U.S. and Mexico are forecast to total 20.03 million this year, topping the previous peak set in 2000, when there were 19.8 million vehicles sold.

But the real driving force behind growth in global auto sales over the coming year will be China, where demand is forecasted to grow by seven per cent to nearly 19.5 million vehicles.

"Global auto sales remain a bright light in a sluggish growth environment and are set to scale new heights in 2015, advancing an additional four per cent," Gomes said.

"Purchases will be buoyed by strengthening labour markets, ongoing low short- and long-term interest rates and monetary expansion, as the Bank of Japan and the ECB take over from the Federal Reserve and the Bank of England as the main liquidity providers. Sales will also get a boost from rising household purchasing power due to the sharp decline in oil prices."