San Miguel creates unit for BMW distribution
SAN MIGUEL Corp. (SMC) is finalizing its entry into auto distribution, with the creation of a new unit for the importation and distribution of BMW vehicles in the country.
In a disclosure to the stock exchange, the diversified conglomerate said it submitted to the Securities and Exchange Commission ( SEC) the documents necessary for the incorporation of SMC Asia Car Distributors Corp.
SMC Asia Car is 65% owned by San Miguel, with the remaining 35% owned by Palawan Governor Jose Ch. Alvarez, who currently chairs Asian Carmakers Corp. (ACC). The company will be involved in the importation, distribution and servicing of BMW vehicles in the country.
At present, ACC is the exclusive importer and distributor of BMW vehicles in the Philippines. It has eight branches, namely Autoallee BMW, Autohaus BMW, Motor Ventures BMW, Prestige Cars Makati, Autobahn BMW Bacolod, Autowelt BMW Cebu, Pampanga Premier Cars, and Premium Motoren BMW.
Vehicle sales in June showed a 14.1% year- on-year uptick, to a total of 37,631 units, according to a combined report Chamber of Automotive Manufacturers of the Philippines, Inc. and the Truck Manufacturers Association (CAMPI-TMP).
The CAMPI-TMP report showed ACC sold 240 vehicles in the first five months of 2017, 27% lower than the 330 units sold during the same period last year. This brought ACC’s market share to 0.15% as of end May.
SMC’s foray into auto distribution comes at a time when the government is looking to impose higher taxes on the automobile industry through the proposed Tax Reform for Acceleration and Inclusion ( TRAIN) bill. Under the legislation, vehicles with an importer’s selling price over P2.1 million to P3.1 million will be taxed a minimum of P668,000 plus 80% in excess of P2.1 million.
Prices of BMW vehicles start at P3 million.
SMC is currently seeing the completion of various infrastructure projects, including the Metro Rail Transit-7 which is expected to be operational by 2019, the Tarlac- PangasinanLa Union Expressway by 2018, as well as the North Luzon Expressway- South Luzon Expressway connector road or Skyway Stage 3 by 2019.
Earlier this month, Mr. Ang announced that the next leg of expansion for SMC would be through electronics, as it aspires to duplicate the success of South Korean electronics giant Samsung.
SMC posted a net income of P13.1 billion in the first quarter of 2017, on the back of strong growth across the firm’s food, beverage, oil, and infrastructure businesses. The company’s profits was supported by a 23% jump in revenues to P195.8 billion.
Shares in SMC were flat at the Philippine Stock Exchange on Tuesday at P102.90 apiece. —