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A demand for the big and powerful

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Photo by Cameron Kirby

Buying a car is considered a major decision that involves careful choosing from a plethora of auto types available in the market. Practicality, versatility, durability, affordability and suitability to one’s lifestyle are some of the factors prospective car buyers are looking for. Given these considerations, more and more are opting for big and powerful autos including sport utility vehicles (SUVs), vans, and pickup trucks.

According to consumerreports.org, a nonprofit organization that does consumer research and product testings, pickups are attracting more buyers, especially those looking for more space. “Truck makers today are building pickups with broader appeal, with a softer ride and more safety, convenience, and comfort features,” it added.

In the past years, Filipinos have shown affinity for bigger autos as well. Some reports indicated that Filipinos prefer buying SUVs and pickups for its sturdiness, and for its ability to accommodate more passengers especially for extended family members. Moreover, its capacity for both city driving and rough terrain as well as wade through floods during bad weather conditions make this segment a popular choice.

The number of sales of this auto segment showed robust sales, and have consistently been included in the list of best-selling cars. Last year alone, automotive Web site AutoIndustriya.com’s list of 10 best-selling cars indicated that more than half of the list are SUVs, vans, and pickups or those under the commercial vehicle (CV) segment.

Sales figures of the CV segment have also shown a steady growth over the past years. Showing a bullish stance in 2017, the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and Truck Manufacturers Association (TMA) reported that out of the 425,673 auto units sold in 2017, 286,249 units of which belong to the CV segment while the remaining 139,424 units were attributed to passenger car (PC) segment.

On the other hand, on a separate report of the Association of Vehicle Importers and Distributors (AVID), it was indicated that out of the total of 106,286 units sold in 2017, the light commercial vehicle (LCV) segment sold a total of 66,564 units while the PC segment recorded a total of 39,722 units sold.

Among those car brands with successful number of sales for SUVs is Honda Cars Philippines. Its seven-seater gasoline SUV, the BR-V, is the brand’s second highest selling model with 7,212 vehicles sold, and considered as the major contributor to Honda’s strong sales performance in 2017.

Meanwhile, although there is a slower growth in sales for the auto industry for 2018 due to the implementation of Republic Act 10963 or Tax Reform for Acceleration and Inclusion (TRAIN) law under the Duterte administration, the CV segment still reflected increase in sales. Media reports stated that according to data by CAMPI and TMA, CV segment sales grew by 12.4% to 21,855 units in January 2018 from 19,441 units in January 2017, accounting more than 60% of the market. PC sales meanwhile indicated a 10.9% decline in January 2018 to 9,790 units compared to the 10,984 units in the same period of last year.

In particular, the LCV segment, composed mostly of SUVs, led the majority of sales for the CV segment, indicating a 23.3% increase in sales or a total of 15,218 units sold compared to last year’s total sales of 12,340 units.

Vehicle brands such as Suzuki Philippines, Mitsubishi Motors Philippines Corporation (MMPC), and Nissan Philippines Inc. (NPI) noted a positive sales performance with 39.8%; 36.7%; and 20.6% increase in sales, respectively.

Apart from reflecting a positive growth in sales at the onset of the year, it can be said that partiality for this vehicle segment is here to stay due to a change in preference of car buyers as well. In fact, NPI, according to media reports, revealed early this year that consumer preference may shift into the pickup trucks segment for 2018.

“Given the competitive nature of pickup trucks, I think preference will change slightly in favor of pickup trucks,” NPI President and Managing Director Ramesh Narasimhan reportedly said.

This is also because of pickups’, along with electric vehicles’, exemption from higher excise tax under the TRAIN law. Year 2018 is also an exciting year for this vehicle segment, as prospective car buyers can look forward to brand new models of SUVs, vans, and pickup trucks that are set to be launched this year. Some reports stated that American car maker Ford is expected to launch seven new vehicles to the Philippine market including their Ranger pickup, the Ranger Raptor, as well as their refreshed SUV lines of Explorer, EcoSport, Everest, and Expedition.

It is also reported that Isuzu Philippines Corporation is set to launch a new variant to their popular pick up models, the D-Max and mu-X, noting that the car brand is keeping their line fresh because of a demanding market especially in the SUV and pickup segments. — Romsanne R. Ortiguero