SALES of automobiles declined in February, as the new tax regime that raised excise taxes on vehicles continued to bite particularly the passenger car segment.
Sales of automobiles fell 3.2% to 26,176 units last month from 27,040 a year ago, according to a joint report from the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and Truck Manufacturers Association (TMA).
Vehicle sales were flat in the first two months of 2018, squeezing out a gain of 0.6% to 57,821 units from 57,465 units in the same period last year.
Another domestic auto industry group, the Association of Vehicle Importers and Distributors, reports its member companies’ sales separately.
“The slight decrease in February sales compared to the same period last year suggests that the market is still adjusting to the new excise tax regime. Sales prospects remain positive as demand continues to be strong,” Rommel R. Gutierrez, president of CAMPI and a first vice-president at Toyota Motor Philippines (TMP), was quoted in a statement as saying.
Signed into law by President Rodrigo R. Duterte in December, Republic Act No. 10963 or the Tax Reform for Acceleration and Inclusion Act increased excise tax rates on automobiles, among other items, when it took effect on Jan. 1.
With the higher excise tax rates, vehicle sales in January started to display signs of weakness, growing by a slower four percent following a spike in December when industry sales surged 33.4% before the new tax rates took effect.
The passenger car segment was the worst hit, with February sales dropping by a tenth to 8,192 units from 9,114 units. Year-to-date sales declined 10.5% to 17,982 units from 20,098 units.
Commercial vehicle sales, which account for the bulk of industry sales, was roughly flat at 17,984 units last month. This brought the full-year sales to 39,839 units, up 6.6% from 37,367 a year ago.
February sales of Asian utility vehicles slid 4.6% to 5,463 units from 5,725 units, dragging the year-to-date sales by 4.1% to 11,274 units from 11,751 units the year before.
Light commercial vehicles — mostly pickups and sport utility vehicles — remained positive, with sales rising 4.7% in February to 11,540 units from 11,025 units. Total sales for the year reached 26,758 units, up 14.5% from 23,365 units.
Sales of light trucks went down 41.3% to 413 units from 703 units, with year-to-date sales declining at the same pace to 799 units from 1,333 units.
In the first two months of 2018, Toyota Motor maintained its dominance with a market share of 39.84%. It was followed by Mitsubishi Motors Philippines Corp. with a share of 22.17%. Ford Motor Company Philippines, Inc. came out third with a 7.95% share.
Honda Car Philippines Inc. and Nissan Philippines, Inc. round out the top five with shares of 7.16% and 6.59%, respectively. — Krista Angela M. Montealegre