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Car sales growth slows, still double-digit

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Car makers are more cautious on their sales projections this year as higher tax rates kicked into effect this month.

VEHICLE SALES growth in the country slowed last year from 2016, but 2017 still saw an increase of nearly a fifth, sustaining the annual double-digit pace the domestic auto industry has been clocking since 2012.

Data jointly released yesterday by the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and Truck Manufacturers Association (TMA) showed the groups’ member companies sold 425,673 vehicles last year, up 18.4% from 359,572 units in 2016.

Last year’s increase was slower than the 24.6% expansion clocked for the entire 2016, as well as the 22.9% and 29.5% increases registered in 2015 and 2014, respectively.

Statistics from the ASEAN Automotive Federation, which are based on CAMPI and TMA reports, showed the Philippine auto industry grew 16% and 11% in 2013 and 2012, respectively.

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CAMPI and TMA members’ cumulative sales surpassed their 2017 target of 400,500 units and nearly hit the entire industry target of 450,000 units, the groups said.

Another domestic auto industry group, the Association of Vehicle Importers and Distributors, reports its member companies’ sales separately.

CAMPI and TMA attributed the positive performance to aggressive promos and new model updates, among others.

However, they maintained a cautiously optimistic outlook for 2018 with the imposition of higher taxes for vehicles.

“While exceeding our sales target for the year, we remain cautious in our projection for 2018. CAMPI remains confident that the market will be able to adjust to the new auto excise tax in 2018,” Rommel R. Gutierrez, president of CAMPI and a first vice-president at Toyota Motor Philippines (TMP), said in a statement.

President Rodrigo R. Duterte last month signed into law Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion, that raised the excise tax for vehicles, among other levies. But the rates were less severe than what was originally expected by the industry.

Automobile deliveries in December alone increased by 33.4% to 45,494 units from 34,104 in 2016’s counterpart month.

The passenger car segment booked sales of 14,182 units in December, up 13.4% annually, bringing the total for the year to 139,424 units, up 4.7%.

Sales of commercial vehicles, which accounted for 67% of industry sales, totaled 31,312 units in December, up 45% from 21,594 units. Full-year sales totaled 286,249 units, up 26.4% from 226,284.

December sales of Asian utility models, classified as commercial vehicles, edged up 2.9% annually to 6,472 units from 6,290. That brought full-year 2017 sales to 79,886 units, up 20.3% from 66,380 in 2016.

Light commercial vehicles — mostly pickups and sport utility vehicles — surged 64.6% in December to 23,434 units from 14,241, taking 2017’s total sales to 189,248 units, up 29.74% from 145,863.

TMP kept its dominance in terms of volume for 2017 as it secured a 43.2% share of the market with 183,908 vehicles sold. Mitsubishi Motor Philippines Corp. followed with a 17.3% share and Ford Motor Co. with 8.6%. Honda Cars Philippines, Inc. came in fourth with a 7.46%, followed by Isuzu Philippines Corp. with 7.07%. — Krista Angela M. Montealegre

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