New vehicle sales in the Philippines declined by 10% to 33,696 units in January 2026 from 37,504 units in the same month last year, according to members’ wholesale data released jointly by the Chamber of Automotive Manufacturers of the Philippines Inc (CAMPI) and the Truck Manufacturers Association (TMA). The market has begun to slow in the last few months, following three years of strong growth.

January’s market decline followed a sharp slowdown in economic growth in the country in the fourth quarter of 2025, to 3.0% year-on-year from 3.9% growth in the third quarter. This was the slowest rate of economic growth since 2021, at the height of the Covid-19 pandemic. Domestic economic activity has been affected by a high-profile infrastructure corruption scandal and by an unusually active typhoon season which brought widespread flooding and damage to key areas of the country.

Consumer spending growth slowed to 3.8% year-on-year in the fourth quarter from 4.1% in the third quarter, while government spending growth slowed to 3.7% from 5.8%, and fixed investment shrank by 7.2% following growth of just 0.5%. The central bank has cut its benchmark interest rate to 4.25% in the last two years, from a peak of 6.5% in mid-2024, to help stimulate domestic consumption.

Sales of passenger cars fell by 20% to 6,178 units last month, while commercial vehicle sales declined by 8% to 27,518 units, including a 9% drop in light commercial vehicle sales to 20,392 units and a 7% drop in Asian utility vehicle sales to 6,253 units, while truck and bus sales amounted to 873 units.

The associations’ data show sales of electrified vehicles surged by 63% to 2,610 units in January, with hybrid-electric vehicle (HEV) sales rising by 43% to 2,072 units, while sales of plug-in hybrids and battery electric vehicles (BEVs) amounted to 277 and 261 units respectively.

Market leader Toyota reported an almost 10% decline in sales to 16,346 units last month, followed by Mitsubishi with 7,003 units (-5%); Suzuki 1,646 units (-8%); Nissan 1,589 units (-33%); and Ford 1,272 units (-19%).

GlobalData expects the Philippine light vehicle market to increase by 2% to 499,000 units in 2026, after growing by almost 4% to 489,000 units in 2025, with sales forecast to increase by a further 4% to 521,000 units in 2027, as consumers continue to respond to the reduced interest rates.