New vehicle sales in the Philippines rebounded to 17,843 units in April 2021 units compared with just 133 in the same month last year when the economy was shut down to help slow the spread of the COVID-19 pandemic, according to member wholesale data released jointly by the Chamber of Automotive Manufacturers of the Philippines Inc (CAMPI) and the Truck Manufacturers Association (TMA).
The market remained well below pre-pandemic levels, however, compared with a total of 25,799 vehicles sold in the same month of 2019. The economy contracted by a worse-than-expected 4.2% in the first quarter of 2021, with consumer and business sentiment affected by a resurgence of COVID-19 infections and the slow rollout of vaccines in the country. This was the fifth consecutive quarter of economic decline, after GDP shrank by 9.5% last year as a result of prolonged lockdowns which held back private consumption and investment.
The associations’ data shows vehicle sales rose by over 36% to 88,155 units in the first four months of the year from depressed year-earlier sales of 64,675 units. This does not include data from members of the Association of Vehicle Importers and Distributors (AVID), which reported a 7% sales increase to 15,857 units combined in the first quarter from 14,554 units a year earlier.
The market has also been affected by the imposition of ‘provisional safeguard duties’ by the Department of Trade and Industry (DTI) at the end of February to help protect the local industry. Duties of PHP70,000 (US$1,443) on imported passenger cars and PHP110,000 (US$2,268) on imported light commercial vehicles are scheduled to be in place for more than six months.
The share of imports has increased steadily over the last 15 years following the implementation of the ASEAN Free Trade Agreement, from 40% to more than 70% of total sales last year. Shipments of completely built-up vehicles from Thailand and Indonesia have risen particularly sharply in this period and brands such as Ford and Nissan have switched entirely to imports.
CAMPI and the TMA expect their members to increase sales by 30% this year after a decline of close to 40% to 223,793 units in 2020.
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