Canadians bought more vehicles this January than last year, with Alberta seeing the greatest sales gains, according to Scotia Economics.

Scotiabank's Global Auto Report, released Monday, shows that Canadians bought 15 per cent more vehicles in January, 2012 than in January, 2011.

One estimate in the report said Canadian auto sales could total 1.7 million units at the end of the year. This is up more than 100,000 vehicles from last year's total.

But Carlos Gomes, author of the report, said this estimate is accurate only if the rest of 2012 sees increases like January's, which is an ideal situation.

More realistic is the report's second forecast of 1.6 million vehicles, which takes into account "differences in seasonality," he said. This estimate puts 2012 car sales about 20,000 units above the previous year.

Sales vary from month to month, so he does not expect a 15 per cent increase from last year to occur each month. Historically, sales are higher in the spring and lower in the winter. The second estimate takes these patterns into account.

Gomes said sales may have been unusually high last month because of the need to replace older vehicles purchased before the recession. He said lower interest rates were also a factor.

Early data for February vehicle sales shows continued gains, Gomes said.

Sales in Alberta jumped 22 per cent (compared to the 15 per cent cross-country average). "Alberta has been leading in sales gains," said Gomes. The lead is partially due to high labour market gains in the western province, which have reached four per cent compared to Canada's average of one per cent, he said.

The total sales in North America are expected to reach 16.1 million units this year, based on the same information. Scotiabank estimates 13.5 million units will be sold in the U.S. in 2012, and 990,000 in Mexico. The global vehicle sales forecast is 2.5 million units more than the total units sold last year.

With vehicle sales up more than expected, North American automakers will likely increase vehicle manufacturing. Japanese and European automakers will continue to expand production facilities in North America in the next few years, furthering the auto industry's increasing strength. For example, Toyota plans to spend US$400 million to boost capacity at one American plant from 50,000 units to 300,000, according to the report.