First quarter car sales slump, blamed on impact of TRAIN

First quarter automotive sales dropped by 8.5 percent with most categories in the red territory on shorter selling days, compounded by the lingering adjustment of buyers to the higher taxes under TRAIN 1.

The joint report of the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and Truck Manufacturers Association (TMA) showed there were only 86,037 units sold in the first three months of the year as against 94,026 units in the same first quarter 2017.

Except for buses and big trucks, all categories were in the negative territory. Sales of passenger cars declined by 9.5 percent while the commercial vehicle segment decreased by 8 percent. Sales of Asian utility vehicles posted a steep 18.7 reduction while the light commercial vehicles, mostly sports utility vehicles, declined by 1.8 percent. Sales of light trucks suffered substantial decrease of 39.2 percent.

CAMPI President Rommel Gutierrez said the decline in sales growth in the first quarter was expected.

“The decline in sales in the 1st quarter of 2018 is not unexpected. The impact of the change in excise tax rates under the TRAIN law was anticipated for this particular period,” he said.

The industry, he said, has remained confident that market will improve in the coming months.

Industry leader Toyota Motors Philippines Corp. registered a substantial 15.4 percent decline having sold only a total of 34,440 units in the first quarter as against the 40,689 units in the same period last year.

But Mitsubishi Motors Philippines Corp. reported a very encouraging 18.4 percent growth in sales to 19,554 units from 16,509 last year.

Ford Motor Company Philippines, Inc., now the third largest car company in the country in terms of sales volume, also reported a huge 17 percent slump in sales to 6,448 units from 7,773 units last year.