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3 Russia-made trucks make Manila debut


RUSSIA-based manufacturer of commercial vehicles (as well as cars and other automotive components) GAZ Group has bolstered its presence in the Philippines by introducing at the recent Manila International Auto Show three new models.
Launched at the show by GAZ Group, through local distributor Gazelle Motors Corp., were the GAZelle Next chassis, GAZon Next, and Sadko 4×4 medium-duty trucks. The new vehicles add to the brand’s lineup composed of the GAZelle Next minibus, GAZelle Next Citiline framed bus, and Ural Next 6×6 heavy-duty truck, shift bus and dumper. All these models were displayed at the GAZ’s booth at the show.
According to Gazelle Motors Chief Executive Fernando L. Martinez, the freshly launched models “affirm GAZ Group’s commitment and interest in the Philippine market,” and that these “demonstrate the versatility and flexibility of the vehicles produced by GAZ Group.”
“These vehicles could be configured to meet the different fleet requirements of local companies and industries,” he added.
The GAZelle Next is powered by a Cummins ISF 2.8-liter diesel engine that makes 150 hp and 330 Nm. Presented as a chassis with a single-row cab, the vehicle can accommodate more than 300 add-on parts to suit a variety of business tasks. In minibus form the GAZelle Next can comfortably seat up to 17 passengers. Configured as the GAZelle Next Citiline framed bus — which has a shorter but wider body — the vehicle can carry up to 19 passengers. Both Next minibus and Citiline are equipped with dual-zone air-conditioning.
Gazelle Motors called the GAZon Next a “new-generation medium-duty truck intended to transport cargo.” It added the truck has a load capacity rating of five tons, and a gross weight rating of 8.7 tons. The truck’s cabin is made of galvanized steel while its chassis can be configured to serve as a dump truck, a multipurpose road maintenance vehicle, or a food and fuel storage tank, among other functions. Powering the truck is a 150-hp YMZ-536 engine (matched to a five-speed manual gearbox) built by Yaroslavl.
Known as a military vehicle, the Sadko is an all-wheel drive medium-duty truck fitted with a 4.4-liter turbocharged diesel engine, power-assisted steering, a tire pressure control system and mechanically driven winch. Like the GAZelle Next variants, the Sadko’s chassis can accommodate various attachments to suit different requirements.
Gazelle Motors was formed in September 2017 after an agreement was reached between GAZ Group and Eastern Petroleum — which now has the exclusive rights in the Philippines to distribute and conduct after-sales services on GAZ Group’s commercial vehicles.

Dashboard (04/18/18)

Ford names 2017 top performing dealers

FORD Philippines said its dealerships in Alabang and General Santos were its “top performing” in Metro Manila and the provinces, respectively, in 2017.
The dealerships were handed their awards during a recent convention, Ford said.
“Our success last year will not be possible without the great collaboration of our dealer principals and their teams, so we’re very happy to celebrate their hard work and achievements at the annual dealer convention,” said Bert Lessard, managing director at Ford Philippines. “We look forward to a more solid partnership with our dealership network nationwide this year as we continue to enhance the Ford ownership experience.”
Ford said it also recognized Lloyd Dumandan of Ford General Santos as sales manager of the year, Johann Martinez of Ford Alabang as general sales manager of the year, and Mario Gener Marte of Ford Manila as branch head of the year.


Scania

Scania now selling pre-owned trucks

SCANIA announced it is now selling its trucks through a certified pre-owned program.
The company said fleet operators can expect its used trucks to have the “same built-in toughness, durability, reliability and low operating costs” as its new trucks do. It added each certified pre-owned Scania — imported from Europe — is not more than five years old and has been “thoroughly assessed and rated by top-notch technicians before they get shipped to the Philippines.”

The tricky process of bringing back a previously damaged car brand

On my automotive website (visor.ph), I recently told the story of a Pampanga-based businessman who is currently in the process of bringing Abarth and Alfa Romeo to the Philippine market. Allen Ong, who now also owns Foton Pampanga, sat down with me for an exclusive interview back in January. He did admit to me that he had not secured any official agreement with Fiat Chrysler Automobiles (FCA), the parent company of the European brands he was targeting, and that he was doing most of the work on his own.
In my mind, I thought: “Okay, so you’re nothing more than a gray-market importer. That’s it.”
My suspicious self was so unimpressed that I didn’t write the story — until last weekend, when Mr. Ong contacted me again and asked help in publicizing the Facebook page “Alfa Romeo Philippines.” And this time, he said, he already has a showroom location (Ortigas Avenue in San Juan) and that construction will commence in June.
Fair enough. It sounded like a substantial enough story. So I wrote it, together with Mr. Ong’s admission that he had no official distributorship or dealership ties with FCA, but that he would receive support in terms of parts supply and warranty.
The following day, I got a call from FCA Asia-Pacific Managing Director Mike Tsesmelis, denying that they have a formal agreement with Mr. Ong for the parts supply and the warranty of the cars he intends to sell. So I got back to the Filipino businessman and informed him of FCA’s objection to his claim.
What ensued was a long thread of back-and-forth that can be summarized like this: Mr. Ong’s supplier (and thus FCA contact) apparently is from Europe, not the company’s regional office in China, which explains why Mr. Tsesmelis isn’t aware of the “negotiations.” Mr. Ong, however, was evasive whenever I asked for the name of any specific FCA or Alfa Romeo executive he was dealing with. He even mentioned a non-disclosure agreement and expressed concern that his contact might be taken to task by FCA bosses if this issue ever got out of hand.
Initially, I was like: “Nah, dude, you don’t know anyone from FCA or Alfa Romeo. You’re likely just sourcing your cars and parts from a foreign dealer, so you can’t mislead your customers by saying that this qualifies as official FCA or Alfa Romeo support.”
But then he kept saying that if he didn’t have an official contact, it would be virtually impossible for him to get the cars and the original parts at the price rates he will sell them for. This from someone who had once also looked into the possibility of importing and distributing Lotus and McLaren vehicles.
In fact, in our previous correspondence, Mr. Ong even asserted that Alfa Romeo actually required that they first approve his showroom design before he could proceed with its construction.
“The difference between me and a gray-market importer is that the gray market can’t support its cars with parts and warranty because it’s difficult to get them,” he pointed out. “And I wouldn’t be pushing through with this if I knew I couldn’t get parts and warranty, because I don’t want to get embarrassed. And it would ruin the brand again, which is what they [Alfa Romeo] are afraid of.”
You will recall that Alfa Romeo was once sold in the country by a distributor called Auto Prominence, which also imported and sold Proton, Volkswagen and Audi back in the 1990s. The mishandling of the brand resulted in a number of angry customer complaints and legal claims, a scenario that definitely spooked the Italian marque.
And so, after trying to digest every single thing that Mr. Ong shared with me, I have arrived at a conclusion.
I believe the guy truly has ties with someone from Alfa Romeo, who may or may not be acting in an official capacity. My theory is that Alfa Romeo just happens to have a cavalier attitude toward our market after its past experience, and who can blame them? They’re quite possibly approaching this whole affair as: “Okay, we have a persistent entrepreneur who wants to sell our cars in the Philippines. Let him. Why not? That would be several units off our crowded lot. But we can’t officially associate ourselves with him, because we’re not sure if he’ll turn out to be a legitimate distributor or another scammer out to just take his customers’ money without providing after-sales support. Because if the latter happens, our brand will be forever doomed in that part of the planet. That would be an absolute PR nightmare in this era of Mark Zuckerberg. So just tell him we’ll give him easy access to our parts bin, and also help him with warranty. But nothing more and nobody has to know.”
Again, that’s just a conjecture.
For now, whether Mr. Ong likes it or not, he’s just an independent importer who’s technically “auditioning” for the part. Unfortunately for him, other Filipino businessmen before him did a terrible job of representing Alfa Romeo in our market. Hence, there is no trust to speak of — he will have to earn this from scratch. The good news is that he seems to have a real chance to do exactly that, but it won’t be easy. Best of luck to him and his team.

Lopez Holdings 2017 profits down on lack of one-time gains

The absence of one-time gains that inflated profits in 2016 dragged earnings of Lopez Holdings, Inc. last year.
In a disclosure to the stock exchange on Tuesday, April 17, the holding firm of the Lopez family said net income attributable to equity holders reached P4.225 billion last year, down 36% from the P6.557 billion reported in 2016.
Weighing on profitability was the lack of extraordinary items booked by First Philippine Holdings Corp. (FPH) in 2016 from the arbitration settlement received by First Philec, Inc. and the liquidated damages collected by First Gen Corp. for its San Gabriel power plant.
Also, ABS-CBN Corp. generated more revenues in 2016 from political ads on top of improved revenues from its Pay-TV and new business initiatives. — Krista Angela M. Montealegre

GBP launches training school for its employees in Iloilo

Global Business Power Corp. (GBP) has launched a learning institute in Iloilo City where its employees can enhance their skills in meeting real life operational and maintenance contingencies in power plants as the company gears up for expansion. — Victor V. Saulon

Robredo camp files complaint over Marcos lawyer’s ‘shameful’ conduct during recount

The camp of Vice President Maria Leonor “Leni” G. Robredo on Tuesday, April 17, filed a manifestation of grave concern to the Presidential Electoral Tribunal (PET) in response to the recent “shameful” conduct of former senator Ferdinand “Bongbong” R. Marcos, Jr.’s lawyer in the ongoing election recount, according to a press statement.
Ms. Robredo’s chief legal counsel, Romulo B. Macalintal, in the statement accused Mr. Marcos lawyer Joan M. Padilla of “(going) around the revision area, aggressively telling the PET Head Revisors to implement the 50-percent threshold percentage, and to post the PET resolution ‘in every corner of table in the revision area,'” following the court’s dismissal of Ms. Robredo’s motion to uphold a 25-percent shading threshold in determining the validity of votes.
“The action of Atty. Padilla is a clear sign of the desire of protestant Marcos to win at all costs, fair or foul by disenfranchising innocent legitimate voters who are not aware of the technicalities and in utter disregard of existing jurisprudence in revision that the will of the voter shall be given effect setting aside any technicalities,” the 8-page petition read. — Dane Angelo M. Enerio

PetroEnergy net income surges on higher electricity sales

Higher electricity sales pulled up the consolidated net income of PetroEnergy Resources Corp. (PERC) 2017 as the listed company posted a 44% increase to $8.46 million from $5.86 million a year earlier.
Net income attributable to equity holders of the company more than doubled to $3.79 million from P1.77 million previously, the company told the stock exchange.
“Our 2017 financial performance shows PERC’s growth-driven direction, credited mainly to the efficiency and reliability of our RE power plant operations. And to be recognized recently by the Financial Times as one of the fastest-growing companies in the Asia-Pacific region is truly and encouraging achievement for PetroEnergy,” said PERC President Milagros V. Reyes in a statement. — Victor V. Saulon

Opposition group urges SC to ‘resist Duterte's tyranny’

Government opposition group Movement Against Tyranny (MAT) urged the Supreme Court (SC) to “not allow themselves to be instruments of Duterte’s tyranny,” according a statement released on Tuesday, April 17.
“The Quo Warranto petition filed by the Duterte regime through Solicitor-General Jose C. Calida is a blatant shortcut that tramples upon the Constitution. It should have been dismissed outright by the Court,” the statement read.
MAT was referring to the petition asking the Supreme Court to void Chief Justice Maria Lourdes P.A. Sereno’s appointment for not submitting completely her Statements of Assets, Liabilities and Net Worth (SALN) as a requirement. — Dane Angelo M. Enerio

Nearly 200 repatriated OFWs arrive from Kuwait

Some 190 undocumented overseas Filipino workers (OFWs) from Kuwait was brought home by the government as part of the amnesty program of the Kuwaiti government, according to the Department of Foreign Affairs (DFA) on Tuesday, April 17.
According to Foreign Affairs Assistant Secretary for Public Diplomacy Elmer G. Cato, about 400 more OFWs would be repatriated under the program. The latest arrivals raised the total number of repatriated OFWs from Kuwait to 4,365. — Camille A. Aguinaldo

Putting people first

Atty. Agnes VST Devanadera’s assumption of the post of chairperson and chief executive officer (CEO) of the Energy Regulatory Commission (ERC) in December of last year came at a time when the agency, which is tasked with ensuring consumer education and protection and promotion of competitive operations in the electricity market, was still reeling from the dismissal of its former head, Jose Vicente B. Salazar. President Rodrigo R. Duterte sacked Mr. Salazar on Oct. 6 after an investigation found him guilty of simple and grave misconduct. A month later, Ms. Devanadera was appointed by President Duterte to replace Mr. Salazar, heralding a hopeful new era for ERC.

“We welcome the appointment of the new chairman and CEO to complete the Commission. We look forward to continuously performing our mandate to the public under this new leadership,” Floresinda B. Digal, ERC spokesperson, said, quoting the agency’s official statement on Ms. Devanadera’s appointment.

At the ceremonial handover of the gavel to the new ERC chairperson in December at the head office of the agency in Pasig City, Department of Energy Secretary Alfonso G. Cusi was upbeat about the selection of Ms. Devanadera. “With all the qualifications, experience and wisdom that she has earned… we can expect a more energized ERC,” he was quoted as saying in a news release by the agency.

Mr. Cusi was at the ceremony along with ERC Commissioners Alfredo J. Non, Gloria Victoria C. Yap-Taruc, Josefina Patricia M. Asirit, and Geronimo D. Sta. Ana, and the staff of ERC. Ms. Devanadera’s family was also in attendance.

In a briefing with reporters a few days before the ceremony, Ms. Devanadera revealed what her priority would be on her first day of work: “synergy among the workers in ERC so that the institution can move faster and the institution can be part of the team in the energy sector that we think can deliver the services better.”

“As we observed during the JCPC (Joint Congressional Power Commission) meeting, there seem to be a lot but there are many other factors that we have to consider. So now that I saw… now that I am the head starting Monday, that will be the immediate direction and order of the day — put the house in order,” she was quoted as saying in a BusinessWorld report. “And I think if we have the right synergy, then the institution will move a lot faster.”

And this need for synergy was what she emphasized in her speech before the people of ERC. “Let us work together, let us work as a team,” Ms. Devanadera said. She also urged adherence to the values of work efficiency and professional competence, and against overlooking what public service really is. “We must not lose sight of the most basic principle of public service: we must put people first.”

And this has characterized her career as a public servant. Ms. Devanadera played an important role in, among other things, the recovery of the ill-gotten wealth of the Marcoses and the prosecution of the individuals implicated in the Maguindanao Massacre. Before becoming the ERC chairperson, she served in the following capacities: Secretary of Department of Justice, solicitor general, mayor of Sampaloc, Quezon, and Undersecretary of the Department of Interior and Local Government.

Remittance growth slowest in 3 months

By Melissa Luz T. Lopez
Senior Reporter

OVERSEAS FILIPINO workers (OFWs) sent more money home in February than a year ago even as it was the smallest increase in three months, the central bank reported on Monday.
Such remittances totalled $2.267 billion for the month, up 4.5% from the $2.169-billion inflows tallied in February 2017, the Bangko Sentral ng Pilipinas (BSP) said.
However, February’s inflows were the smallest in three straight months.
February’s year-on-year growth pace is likewise the slowest since a two percent increase recorded in November.
Despite the decline, February remittances brought the two-month tally to $4.647 billion, 7.1% more than the $4.338 billion received in last year’s comparable period.
The growth in cash remittances came as money transfers from both land-based and sea-based workers rose by 6.4% to $3.7 billion and 9.8% to $1 billion, respectively, the BSP said.
The United States remained the biggest source of inflows at $747.049 million, which accounted for 1.2% of the overall growth in February.
Other major sources of funds were the United Arab Emirates ($196.377 million), Germany ($76.181 million) and Malaysia ($39.422 million), the central bank said.
The central bank expects remittances to grow by another four percent this year to above $29 billion, which if realized will mark another banner year. In 2017, remittances grew by 4.3% to reach $28.06 billion, beating a four percent growth forecast.
Remittances fuel domestic consumption, which in turn supports overall economic growth.
They also counterbalance the huge import payments which keeps the country’s external position in deficit.
One analyst said household spending likely remained robust despite a slowdown in remittances received in February, as the exchange rate — which boosted the dollar by 3.7% — meant more bang for their buck once converted to the peso.
Remittance
“As a result, this has reduced the required US dollars needed to be sent by OFWs to the Philippines, given the higher value of the US dollar vs. the peso (i.e. less US dollars needed for the same amount of pesos),” Michael L. Ricafort, economist at the Rizal Commercial Banking Corp. (RCBC), said when sought for comment.
In turn, this gives families of OFWs more disposable income, Mr. Ricafort said, explaining: “This still supports greater consumer spending growth, which, in turn, may still underpin faster economic growth, going forward.”
Latest Philippine Statistics Authority data show household spending — which contributed the biggest share of 57.5% to the economy last year — growing by 5.9%, 6.0%, 5.4% and 6.2% in the first to fourth quarters of 2017, leading to a 5.9% full-year increase that was a marked slowdown from 2016’s 7.1%.
RCBC’s Mr. Ricafort noted that some migrant workers may have held on to their salaries waiting for an “optimal” peso-dollar exchange rate.
The peso averaged P51.7856 to the greenback in February, weaker than the P49.9614 average recorded during the same month last year, according to BSP data.
Still, analysts at HSBC Global Research believe that remittances will likely grow faster this year amid improving global growth led by the United states, as well as rising oil prices which in turn will benefit economies in the Middle East where many OFWs are based.

WB tags better jobs as economy’s ‘missing link’

THE WORLD BANK said that better quality jobs and faster real wage growth are the “missing link” to reducing poverty and inequality in the country, even as the government pursues more aggressive infrastructure development.
“The key challenge facing the government is not unemployment, but rather the poor quality of jobs in the labor market, as a large share of employment opportunities in the Philippines consist of low-paid jobs,” the World Bank said in the Philippine Economic Update report it released on Monday.
The multilateral lender also said that the government should spend more on improving the country’s human capital, complementing state efforts to improve infrastructure.
GROUND FOR FASTER GROWTH
“Really, the push is the emphasis in investment, not only in infrastructure but also really heavily in human capital, expenditures that are going to education, health. So this is really is the foundation for higher growth in the future,” World Bank lead economist for the Philippines Birgit Hansl in a press conference yesterday.
She noted that economic benefits of the current administration’s infrastructure projects won’t be felt until 2020.
The multilateral lender said the country has a lower unemployment rate but high underemployment and slow increase in real wage, which takes into account the impact of inflation.
It explained that this is partly due to agricultural workers’ shift to low-quality, low-skilled jobs in the service sector, as the Philippines has for years failed to improve its manufacturing base that could have provided better jobs, such as in the case of East Asian neighbors.
IMPERATIVE
“So what the Philippines really needs is to attract more investments that lead to jobs and producing higher productivity, so that we see higher real wage increase. That’s why it is really necessary to attract investors from outside and inside for expanded capacity in manufacturing, and invest heavily in human capital to allow people in lower paying jobs to move from sectors like agriculture and low-skilled services to higher, productive jobs that are in high demand,” said Ms. Hansl.
She added that this would help guard the Philippine economy from “overheating,” by which the country fails to sustain its relatively fast economic growth due to poor support from infrastructure and human capital.
“This is what happens when you have high fiscal spending that is pouring into wage growth, causing people to want to spend more,” Ms. Hansl explained.
“Then prices will increase because firms cannot produce more because they have a limited capacity,” she added.
“Even if you would like to produce more, you couldn’t at this point without investing first in new productive capacity or educating more people…” she added.
“This is where the Philippine economy is: where it likes to grow more, but it first needs these investments.”
The Philippine Statistics Authority (PSA) in its January 2018 Labor Force Survey reported that unemployment rate declined to 5.3% from 6.6% in the same survey round last year.
At the same time, however, underemployment rate — which reflects workers who wanted more hours of work or an additional job — increased to 18% from 16.3%.
“The government needs to adopt mutually reinforcing policies that will create a growing middle class that is well-integrated with other income groups. This should include the implementation of interventions across multiple sectors that address both supply- and demand-side constraints for creating more well-paying jobs in the labor market,” the report read.
The World Bank also urged the government to “upgrade value chains to support strong and sustainable growth, and strengthen backward and forward linkages to take advantage of skilled labor and create jobs for the unskilled,” as well as address institutional constraints, strengthen competition, secure property rights, and simplify business regulations.
The lender expects the Philippine economy to sustain 2017’s 6.7% growth in 2018 and 2019, before slightly moderating to 6.6% in 2020. The government, in comparison, targets a 7-8% economic growth rate from 2018 to 2022, while cutting unemployment rate to 3-5% also by then from 5.5% in 2016, and reducing poverty incidence to 14% from 21.6% in 2015. — Elijah J. C. Tubayan

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