Vehicle sales to grow by at least 10% next year

New vehicle sales are expected to grow by at least 10% next year with the launch of new models, according to the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI). 

“Well, easily, total industry sales will increase by 10% next year,” CAMPI President Rommel R. Gutierrez told reporters on the sidelines of the 9^th Philippine International Motor Show last week.

For this year, CAMPI has set a sales target of 468,300 units, but hopes it can reach as much as 500,000.

“Our target was 468,000, and it looks like we can do it. [The] 500,000 is an aspirational figure. But if [we can’t reach that] this year, most likely next year because we are almost there. We still have a lot of product launches,” Mr. Gutierrez said.

In the first nine months of the year, vehicle sales grew by 9.4% to 344,307 units from 314,843 units in the same period last year, data from the joint report by CAMPI and the Truck Manufacturers Association (TMA) showed.

The total sales for the January-to-September period already represent 73.5% of the industry’s sales target for the year.

However, the latest report also showed that the growth in sales of commercial vehicles was flat at 29,104 last month, bringing the total sales’ year-on-year growth to 2.4% at 39,542.

Despite this, Toyota Motor Philippines Corp. Head of Marketing Services Elvin G. Luciano said that this is not of concern as demand for Toyota commercial vehicles is still strong. 

“So far, for Toyota, the commercial vehicle sales are steadily strong. There is a heavy demand for our commercial vehicles,” Mr. Luciano told BusinessWorld on the sidelines of Toyota’s Beyond Zero Media Presentation on Saturday.

In the January-to-September period, Toyota remained the market leader with sales of 159,088 units, up 10.3% from 144,232 units a year ago. The car manufacturer’s sales accounted for 46.2% of the industry’s total.

Broken down, Toyota saw a 6.9% increase in commercial vehicle sales to 111,541 in the first nine months and a 19.1% jump in passenger car sales to 47,547 units.

“We are targeting more than 200,000 sales this year. Historically, sales are stronger during the ‘ber’ months as there is higher consideration for vehicle purchases, especially come December,” said Mr. Luciano.

“We are also banking on our new hybrid models. We just launched the full electrified lineup this year and Corolla Cross and Yaris Cross are among our main drivers for hybrid sales,” he added.

Industrywide, Mr. Gutierrez said that the industry is expected to sell over 10,000 units of electrified models this year.

“Last year we sold 10,000 units of hybrid and pure electric vehicles (EVs), but the pure EVs only accounted for less than 500,” he said.

“But definitely, that 10,000 will be surpassed this year. I think on average, we are confident that [EV sales] will be 10% higher than last year,” he added.

Mr. Gutierrez said, however, that the sales will still be dominated by hybrid vehicle sales, accounting for 75%.

However, Mr. Gutierrez said that only 30% of the vehicles sold by the industry are being manufactured locally.

“It’s still around 30%. It’s a bit steady because Toyota Vios and Innova are still here, and their production is around 60,000 a year,” he said.

The latest report from the Association of Southeast Asian Nations (ASEAN) Automotive Federation showed that the country has so far produced 75,644 motor vehicles in the first seven months. This represents a 15.2% increase from the 65,664 units it produced in the same period last year.

Despite the growth, the country’s total production was still smaller compared to that of Thailand (886,069), Indonesia (671,311), Malaysia (462,347), and Vietnam (86,173).

Because of this, Mr. Gutierrez said that the industry wants the Philippine government to continue to implement a Comprehensive Automotive Resurgence Strategy (CARS)-like program.

“Because again we still need the support of the government for local manufacturing. Especially now that the CBUs (or completely built units) are becoming more competitive,” he said.

“Local manufacturing needs support from the government in order to maintain its viability both for EVs and non-EVs. The government is supportive of manufacturing. I am sure we are looking at various incentive schemes by the government,” he added. – Justine Irish D. Tabile, Reporter