PH auto sales surge on attractive financing
Once a backwater in Southeast Asian auto markets, the Philippines is now heading for a third straight year of record auto sales on strong consumer spending and easy financing while weak economic growth squeezes oncebuoyant neighbors.
Data from the Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI) point to sales of 310,000 vehicles this year, up nearly a third from last year – and roughly double the tally in 2012. The growth could be sustained in the coming years partly due to the government's unveiling of a long-awaited $600-million incentive scheme earlier this year.
While the Philippines is only the region's fourth-biggest market, sales are falling in the top three – Indonesia, Thailand and Malaysia. The trend is fueling industry hopes in Manila that automakers like Japan's Toyota Motor Corp and Mitsubishi Motors Corp., dominant in the Philippines, may boost investment in local production facilities to draw on a widening growth pool.
"Auto sales continue to be strong because of the steady growth of buying capacity of customers," CAMPI President Rommel Gutierrez told Reuters in a text message. "Financing companies are also offering attractive financing packages which make purchasing vehicles easier."
Surging auto sales have been accompanied by a jump in total auto loans, up a record 26 percent in the first quarter to 244.6 billion pesos ($5.24 billion), according to central bank data. As the Philippine middle class grows, and avails itself of the car purchase perks from Manila, market leader Toyota has strong hopes for entry-level vehicles like its Wigo hatchback and Vios compact sedan. (Reuters)