New vehicle sales in Philippines remain flat in April

(Excerpt)

New vehicle sales in the Philippines stood at 25,799 units during April, up 0.8% year on year (y/y), reports the Philippine Star, citing data released by the Chamber of Automotive Manufacturers of the Philippines Incorporated (CAMPI) and the Truck Manufacturers Association (TMA). Of this total, sales of passenger vehicles fell by 22.7% y/y to 7,661 units, while commercial vehicle (CV) sales rose 15.7% y/y to 18,138 units. In the year to date (YTD), total vehicle sales in the country are down 0.4% y/y at 111,187 units. This is split between passenger vehicle sales of 33,833 units (down 12.8% y/y) and CV sales of 77,354 units (up 6.3% y/y). "Sales last month remain erratic on a monthly basis, but we expect that positive growth trend on a yearly basis will continue to improve in the coming months," said CAMPI president Rommel Gutierrez.

Significance: The Philippine new vehicle market has remained in positive territory for the past three months. The marginal growth in April was mainly due to a low base of comparison However, despite the improvements over the last three months, YTD sales remain in negative territory, mainly due to the implementation of higher vehicle excise taxes; higher petroleum prices, which have raised the total cost of owning a vehicle; and the indirect impact of higher interest rates and inflation, which have affected buyer preferences and priorities. As reported earlier, the industry hopes to recover with a 10.0% y/y increase in sales during 2019. IHS Markit expects light-vehicle sales in the country, including passenger vehicles and light commercial vehicles, to grow by 8.9% y/y to 422,827 units in 2019, mainly thanks to new model launches and a low base of comparison.

This article was published by S&P Global Mobility and not by S&P Global Ratings, which is a separately managed division of S&P Global.