Vehicle industry well tuned up to hit sales goal
Ben Arnold O. de Vera
Manila Times
THE increasing demand for fuel-efficient vehicles and the continuous remittances of overseas Filipino workers (OFWs) will keep the domestic automotive industry on track to meeting its sales target despite skyrocketing fuel prices worldwide, according to the Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI).
On the sidelines of the launch of the upcoming 2nd Philippine International Motor Show, Elizabeth Lee, Campi president, said that more car companies are selling fuel-efficient units, reflecting the growing number of customers’ intent on saving up on gas. These low-displacement cars have propped up this year’s sales to date, she said
“Due to rising gasoline prices, fuel efficiency is now an important criteria in purchasing a car. Also, more motorists now are ensuring efficient maintenance of their cars and employing economical driving habits so they could save up,” Lee said.
The CAMPI president said more money sent home by OFWs is spent on buying vehicles, adding, “Lately, it was observed that more Filipinos feel that [buying] a car gives back a larger return of investment than buying a house or putting the money in the bank.”
Last week, the Bangko Sentral ng Pilipinas reported that OFW remittances grew 14.7 percent year-on-year to $6.8 billion in the first five months this year. It forecast remittances to reach $16.4 billion this year from $14.4 billion last year.
However, Lee acknowledged that more expensive fuel dampens local car companies’ operations, specifically in terms of their logistics and procurement of raw materials. “But the impact is not just felt in the Philippines. It is a global phenomena,” she said, adding, “Despite the increasing cost of production, not a lot of local assemblers have increased car prices.”
For instance, Nissan Motor Philippines, Inc. is even reducing its prices this quarter, according to Valentino de Leon, the company’s senior vice president for administration and corporate planning.
De Leon said the company cut prices to boost sales and remain competitive. He said Nissan would launch a relatively inexpensive variant of its X-trail next month.
The Nissan executive is hopeful that sales targets would still be met, but admitted that rising gas prices has resulted in a “wait and see” attitude among buyers.
CAMPI recently reported that June sales fell 1.2 percent to 10,772 units from the 10,900 sold in May. Sales for the first six months however were still up by 13.6 percent year-on-year at 61,654 units from the 54,257 units sold in the same period last year. The five-month total accounts for 49.13 percent of the industry’s target of 125,500 units for the whole year.
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