2014 Another Banner Year for the Automotive Industry

The year 2014 ended on a very high note as the Philippine automotive industry achieved record breaking feats month after month. Based on reports issued by the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and Truck Manufacturers Association (TMA), the group sold a total of 234,747 units. Compared to its total sales of 181,283 units in 2013, last year’s sales total represents an unprecedented growth rate of 30 percent. This record performance was backed by robust sales in all product categories.

The passenger car segment exhibited the highest growth rate of 48 percent with sales of 90,287 units compared to the total sales of 61,083 units in 2013. As explained by CAMPI President Atty. Rommel Gutierrez, “This growth in the passenger car sales was largely fuelled by the successful introduction of several new models and wider acceptance of small car product category.”

The commercial vehicle segment also performed well with a sizeable increase of 20 percent or 144,460 units in 2014 compared to 120,200 units sold in 2013. Within the commercial vehicle category, Light Commercial Vehicle showed a significant volume increase of 26 percent with sales of 93,589 units for 2014 compared to the 74,398 units sold in 2013.

Top market performer for 2014 is still Toyota Motors Philippines Corporation with 45 percent market share. Mitsubishi Motors ended the year in second with 21 percent share. Ford climbed to third with 8.7 percent share while Isuzu finished fourth with 6 percent share. Honda completes the top five with 5.7 percent.

For its other accomplishments last year, the industry also handled the highly acclaimed and most successful 5th Philippine International Motor Show. With bigger indoor and outdoor brand participation, one of a kind special exhibit of iconic vehicles and the new After Sales & Technology Pavilion, PIMS5 attracted the biggest crowd in the motor show’s history. Despite practically losing the Friday show due to typhoon, the 4-day event was able to draw in an estimated 90,000 visitors.

In the area of ensuring consumer protection and enhancing customer satisfaction, the industry, after nine long years of working closely with various government agencies, finally saw the passage of Republic Act 10642 or the Philippine Lemon Law together with its implementing rules and regulations. On top of this, CAMPI also launched the Anti-counterfeit Parts Campaign during the motor show.

2015 Outlook

For 2015, expect the CAMPI-TMA group to reach greater heights as it released its sales target of 272,000, or an additional volume of 37,000 units for a projected growth rate of at least 16 percent. The reasons cited include the projected continued improvement of the economy, increased government spending in preparation for next year’s national election and the positive impact of the projected continued decline in world fuel prices. Of this volume, passenger cars and commercial vehicles will take up 40% and 60%, respectively.

Atty. Gutierrez expressed confidence that the 2015 total industry demand can easily exceed 300,000 units. He also noted that this fearless forecast is well within the market growth projection the industry submitted as part of the roadmap where 2015 would be the year when the market is expected to breach the 300,000-unit mark. He, however, emphasized that the challenge remains to be for the local assembly sector to maintain or even increase its share of this growing market and that the industry continues to wait for the announcement of the appropriate initiative package from the government to make this happen. For 2014, locally assembled vehicles accounted for only 37 percent while imported vehicles captured 63 percent.

In terms of product category, the small car passenger segment will continue to attract more buyers particularly the young professionals comprising the growing BPO industry. The industry also projects a bigger demand for SUV and light commercial vehicles mainly due to the worsening weather pattern. As explained by Atty. Gutierrez, “Many consumers now see the need as well as practicality of owning SUVs and similar higher vehicles to combat the floods. Dropping oil prices, wider product selection at competitive prices and improved fuel efficiency of higher displacement vehicles are providing the additional push especially to those who are considering a second vehicle purchase.”

For its other activities, this year will be the Philippines’ turn to host APEC 2015 and the industry as an active APEC participant will be hosting two APEC Auto Dialogues. It plans to put in the agenda the discussion of programs that will promote parts and components development by the SME sector. As Atty. Gutierrez concluded, “This year will be another busy, lively year as we eagerly attend to a robust market while we continue to find ways to develop the industry.”

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