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Policy rate seen at 4.5-5% in 2025

The skyline of Metro Manila. — PHILIPPINE STAR/MIGUEL DE GUZMAN

By Luisa Maria Jacinta C. Jocson, Reporter

THE BANGKO SENTRAL ng Pilipinas’ (BSP) rate-cutting cycle is expected to continue into early 2025, with the terminal rate seen as low as 4.5-5%, analysts said.

“This is not likely to be a one-and-done rate cut,” ING Bank N.V. Research Head and Chief Economist for Asia and the Pacific Robert Carnell said in a report.

“We see inflation stabilizing around the 3.5% level in 2025, so allowing for some positive real (inflation-adjusted) policy rate, a terminal rate for BSP policy rates could be around 4.5%-5%, a further 125-175 bps (basis points) lower than today,” he said.

HSBC said it expects the BSP to deliver another 25-bp cut this year and 100 bps in reductions in 2025 to bring the policy rate to 5%.

HSBC economist for ASEAN (Association of Southeast Asian Nations) Aris D. Dacanay said that the BSP’s easing cycle will likely be gradual.

“We think the BSP can afford to gradually cut policy rates since nothing terrible is happening in growth. In fact, the labor market remains very strong with employment exceeding what the demographic trend would suggest,” he said in a report.

The Monetary Board last Thursday delivered a 25-bp rate cut, bringing the benchmark rate to 6.25% from the over 17-year high of 6.5%.

This was the first time the BSP reduced rates since November 2020.

BSP Governor Eli M. Remolona, Jr. said that the central bank will support a “calibrated shift to a less restrictive monetary policy stance” as it sees that risks to the inflation outlook continue to lean on the downside for this year and 2025.

Mr. Remolona said there is room for another rate cut in the fourth quarter, possibly by 25 bps. The Monetary Board’s last two policy-setting meetings for the year are on Oct. 17 and Dec. 19.

ANZ Research likewise expects a 25-bp cut in the fourth quarter due to “weak private consumption and an improving inflation outlook,” with the rate-cutting cycle to continue into early 2025.

Mr. Carnell said that the BSP’s continued easing cycle is due to expectations of an inflation downtrend.

“Philippine inflation is likely to slow substantially in the months ahead as rice prices at worst stay elevated but fail to deliver a further boost to inflation as last year’s price increases drop out of the year-on-year comparison,” Mr. Carnell added.

Inflation accelerated to a nine-month high of 4.4% in July. The BSP expects inflation to return to target in August onwards.

The central bank sees inflation averaging 3.4% this year and 3.1% in 2025.

“We could see BSP tracking the Fed one-for-one in the coming months as the Fed finally begins its own easing cycle — depending on how the (peso) behaves. And further easing looks probable in 2025,” Mr. Carnell said.

Financial markets are betting on a 74.5% likelihood that the Fed will cut its key policy rate by 25 bps as it ends its September policy meeting, with a diminishing 25.5% chance of a super-sized 50-bp cut, CME’s FedWatch tool showed, Reuters reported.

“This is about the first regular rate cut of any Asia-Pacific central bank, and coming ahead of anticipated Federal Reserve easing makes the move all the more gutsy,” Mr. Carnell added.

Mr. Dacanay said that monetary policy will now be more data dependent.

“Each incremental rate cut will depend on what direction inflation goes relative to expectations (upside or downside),” he added.

IMPACT ON PESO
The BSP’s easing cycle is also unlikely to significantly impact the local currency, analysts said.

“The peso is still one of the top-performing Asian currencies month-to-date. With the Fed set to cut in September and the (US dollar index) softening, the BSP rate cut is unlikely to cause major renewed weakness,” ANZ Research said.

The local unit closed at P57.245 per dollar on Friday, weakening by 34.5 centavos from its P56.90 finish on Thursday. The peso has been slowly recovering since it fell to the P58-per-dollar level in May.

“The immediate market response has been for the Philippine peso to weaken only slightly, suggesting that this is not seen as an extravagant move,” Mr. Carnell said.

Meanwhile, Enrico P. Villanueva, a senior lecturer at the University of the Philippines Los Baños Economics Department, said that the rate cut “should have been sooner with both actual inflation and forecast numbers are already within target.”

“As a result of continued high rates, consumption and investment have been tepid. The second-quarter rise in investment was largely a result of government spending on infrastructure spilling onto allied private construction industry,” he said via Messenger.

Household consumption, which accounts for about three-fourths of the economy, slowed to 4.6% in the second quarter from 5.5% a year ago.

“Nonetheless, the change in policy stance and actual rate cut are still a welcome development. They signaled policy direction of the government and reduced the uncertainty over when monetary easing will actually begin,” Mr. Villanueva added.

RRR CUT
Meanwhile, analysts expect that the BSP can soon begin reducing banks’ reserve requirement ratio (RRR).

“The BSP can hopefully start cutting the 9.5% RRR sometime later this year and hopefully a good part of 2025,” Bank of the Philippine Islands (BPI) Lead Economist Emilio S. Neri, Jr. said in a Viber message.

“The Monetary Board has the room to alternate the RRP and RRR cuts as long as liquidity and monetary conditions remain supportive of their price stability mandate,” he added.

BSP Governor Eli M. Remolona, Jr. last week said that the RRR should be reduced “substantially” as it is currently at a “ridiculous” level. Mr. Remolona earlier said that it can be reduced to as low as 5%.

Bringing down the reserve requirement must be timed correctly and implemented during a  period in which the central bank is already easing, he earlier said.

The current level “distorts” financial intermediation and drives a wedge between lending and deposit rates, he added.

The RRR is the percentage of bank deposits and deposit substitute liabilities that banks cannot lend out and must set aside in deposits with the BSP.

The BSP reduced the ratio for big banks and nonbank financial institutions with quasi-banking functions by 250 bps to 9.5% in June 2023.

The central bank has brought down the RRR for universal and commercial banks to a single-digit level from a high of 20% in 2018.

“Every 1% cut in RRR is estimated to release about P150 billion worth of banking liquidity, or equivalent to 18% of net RPGB (Republic of the Philippines Government Bonds) supply in the financial year, though much of it would likely be absorbed into the BSP’s monetary operation tools,” ANZ Research said.

Security Bank Corp. Chief Economist Robert Dan J. Roces said that lowering the RRR would “inject more liquidity into the banking system, technically leading to increased lending, lower borrowing costs, and stronger economic growth.”

“The BSP will weigh the pros and cons, and as the governor has said, the optimal timing and magnitude of an RRR reduction will depend on factors such as inflation, economic growth, and financial system stability,” he said in a Viber message.

On the other hand, Mr. Dacanay said that the current 6.25% policy level is still restrictive.

“We think the discussion of reducing the RRR will come to the fore when the policy rate is normalized to a more neutral level,” he added.

Philippines’ smoke-belching king of the road faces overthrow

A JEEPNEY waits for passengers along Agoncillo Street in Manila, July 16, 2024. — PHILIPPINE STAR/RYAN BALDEMOR

By Chloe Mari A. Hufana, Reporter

LACSON ANTHONY J. VIDUYA, 70, managed to send his six children to college using income from driving a rickety passenger jeepney in the Philippine capital.

He’s one of the more than 30,000 drivers and operators in Metro Manila who have consolidated under a jeepney modernization plan that seeks to professionalize the sector, while promising to make them more profitable.

Critics say the plan is anti-poor, and the new business model that it seeks to spawn is a case of corporate capture.

“I joined a cooperative because I had to,” Mr. Viduya, who bought his traditional jeepney in early 2000 after coming home from Riyadh, Saudi Arabia where he worked as a technician for 15 years, told BusinessWorld in Filipino.

The Filipino senior, who plies the Baclaran-Dapitan via Taft Avenue route, beat an April 30 deadline to join a cooperative under threat of losing his livelihood. He paid P20,000 ($348) when he joined his cooperative.

“I surrendered ownership of my jeepney to the cooperative because I had to,” he said while waiting in line at a terminal along Taft Avenue in Manila. “Being a jeepney driver is the only job I know.”

The Philippine jeepney operates under a “boundary system,” where the driver, usually male, pays the jeepney owner called the operator a fixed daily amount called the boundary.

Jeepneys have been known as the king of the road, mainly due to the aggressive driving behavior of their drivers. They have been called both a public convenience and nuisance because they suddenly stop in the middle of the road to load and unload passengers.

President Ferdinand R. Marcos, Jr. this month rejected a proposal to suspend the government’s jeepney modernization program, insisting that it wasn’t rushed.

About 80% of public utility vehicle operators have consolidated their franchises under cooperatives or corporations so they can buy new transport vehicles, he said.

“I disagree with them because they said this was rushed,” the President said. “This has been postponed seven times… Those who have been objecting or have been crying out and asking for suspension are in the minority.”

Twenty-two senators have filed a resolution calling for the suspension of the modernization program, saying it had been rushed.

“This simply shows that President Marcos did not thoroughly study the Senate resolution that aims to suspend the modernization program until it is properly reviewed,” transport group PISTON National President Mody T. Floranda said by telephone in Filipino.

Mr. Floranda expressed disappointment over what he said are contradictory state policies on jeepney modernization.

He said members of a group that held a “unity walk” on Aug. 5 to protest the Senate resolution are buried in debt due to the modernization process. About 400 people participated in the pro-modernization rally.

Mr. Floranda urged the Supreme Court to fast-track its decision on PISTON’s lawsuit seeking to halt the modernization program.   

“The lack of a ruling is causing more confusion,” he said in Filipino. “We are still hoping that the Supreme Court will support the situation of the transportation sector.”

Orlando F. Marquez, Sr., national president of the Liga ng Transportasyon at Operators sa Pilipinas, said there might be kinks in the government’s modernization program, but most drivers and operators have accepted that it is inevitable.

That’s what prompted them to do the “unity walk,” he told a news briefing on Sunday.

‘HUMAN DIGNITY’
Gina R. Gatarin, a researcher at the Western Sydney University, said Filipinos have long been denied the right to a comfortable, safe and efficient travel experience.

“But while it has long been overdue to ensure that transport planning and policy making enable just mobilities for most people who rely on public transport, the plans, process and policies for transition must ensure that no one is left behind,” she said.

Ms. Gatarin, who wrote a study on the modernization plan, cited the need for “pathways of just transitions” in enforcing the system-wide change.

Because urban mobility is about human dignity, the government should consider not just the environment and mobility but also labor justice, she said in the study released in April.

Some grassroots organizations have said the government’s anti-poor and profit-oriented program would affect at least 118,000 families and 685 jeepney routes in Metro Manila alone.

The modernization program started in 2017 under ex-President Rodrigo R. Duterte, aiming to replace traditional smoke-belching  jeepneys with units that have at least a Euro 4-compliant engine to cut pollution.

The deadline for jeepneys to consolidate into cooperatives lapsed on Dec. 31, 2023, but public utility vehicles were allowed to keep operating until Jan. 31, 2024. The President later extended the deadline to April 30.

The modernization program seeks to establish a state-of-the-art public transport system that induces operators to renew their fleets using higher-capacity vehicles that are also more efficient.

It also lays the groundwork for the electrification of the public transport fleet toward full decarbonization.

“The jeepney sector is highly fragmented and individualized in terms of ownership and operation,” according to a report published by the Japan International Cooperation Agency in 2022.

It added that the lack of consolidation had led to a vehicle-to-franchise ratio of 2.25. About eight of 10 jeepney operators own a single unit.

Under the modernization program, a cooperative must have at least 15 members before it can register with the Office of the Transportation Cooperatives under the Department of Transportation.

IMPORT BIAS
Elmer B. Francisco, chairman of local jeepney maker Francisco Motors Corp., said a locally assembled, fully electric modern jeepney would cost P1.99 million, cheaper than the imported units from Japan and China at P2.8 million.

The company had taken 60,000 pre-orders of fully electric jeepneys from all over the country as of June, he told BusinessWorld via Zoom. But he cited the slow permitting process to mass produce modern jeepneys.

There also seems to be a bias for established foreign vehicle makers such as those from China and Japan. Local manufacturers like Francisco Motors and Sarao Motors, Inc. can hardly keep up with demand given their limited production capacities.

“We need the support of our own government because other manufacturers — foreign manufacturers — have the support of their own governments,” Mr. Francisco said. “I call on the President to support Filipino manufacturers. Support local. We can produce our own electric vehicles.”

Mr. Francisco said modernization is important to help the environment, make commuting easier and safer for Filipinos and boost the economy.

But most jeepney drivers and operators might be unable to afford the costs of modernization, including joining a cooperative and buying new units, he said.

He shared a lesson from his late father Jorge, who founded the company in 1947 and who said that “if the jeepney operators you’re selling to can’t make a living from the jeepney you’re selling, then don’t sell it.”

Mr. Francisco also faults imported jeepneys that look like minibuses rather than the traditional Filipino jeepneys that are painted with themes including love, sex, religion and family.

He noted that while Francisco Motors imports some jeepney parts, they assemble the units locally, providing jobs to thousands of Filipinos.

Teodoro C. Mendoza, a retired professor and crop scientist from the University of the Philippines Los Baños, cited two main “blind sides” in the state’s modernization plan — the high price of modern jeepneys and the “domino effect” of possible fare increases to cover the cost of these units.

This is especially true for imported jeepneys given the peso’s slump against the dollar. High unit prices mean high yearly payments, which will be compounded by high interest rates, he said.

Mr. Mendoza, who wrote a paper on the modernization plan in 2021, said higher fares mean higher costs of food and other commodities.

“In effect, higher transport costs will mean a higher cost of living,” he said in his study. “A consequence of this is that daily wage earners will demand higher wages, which will have repercussions on the economy at large.”

Mr. Mendoza said the government should subsidize local modern jeepney manufacturers instead of pushing imports.

“Why would you want to enrich foreign jeepney manufacturers?” he told BusinessWorld by telephone. “We can do that ourselves. We can locally fabricate them. That’s why we need to make it homegrown,” he said in Filipino.

“The way forward should be to support local manufacturing of modern jeepneys, support the initiative of Francisco Motors and similar companies,” Mr. Mendoza said. “The government shouldn’t rush because if we manufacture jeepneys locally, it will generate employment in the manufacturing sector.”

Mr. Mendoza estimates that it will take 70 years to replace Metro Manila’s jeepneys and 270 years nationwide, assuming minibus manufacturers can make 1,000 modern units a year. Almost P12 billion is needed to replace 73,000 traditional jeepneys in the capital region and P540 billion to replace 300,000 jeepneys nationwide.

Ms. Gatarin said that instead of a one-time, big-time change, the state might need to choose pilot areas where it can implement the program and show that it works.

She cited the South African experience in improving its bus system and paratransit integration, which involved a flexible transition over several years.

“This cannot be achieved simply by pressing on informal workers to surrender their old vehicles and accept that [they] will be merely cogs in a fleet management system,” Ms. Gatarin said in her study.

“What would seem like scrap metal, as the jeepney is currently framed in the government pronouncements, is a cherished possession reflecting the hard work and sacrifice of low-income drivers to make a decent living,” she added.

In June, the Land Transportation Franchising and Regulatory Board said it was considering another one-year extension for unconsolidated jeepneys.

“If they do not want to help, then they should at least not make our life harder than it already is,” Mr. Viduya, the jeepney driver mentioned at the outset, said.

BIR misses end-July collection goal by 8%

PHILIPPINE STAR/EDD GUMBAN

THE BUREAU of Internal Revenue (BIR) fell short of its end-July collection target by 8.2%, data from the Department of Finance (DoF) showed.

Preliminary data posted on the DoF’s Facebook page showed that BIR collections as of end-July stood at P1.68 trillion, falling short of its P1.83-trillion collection goal for the period by 8.2%.

The tally as of end-July represents 55.08% of the BIR’s P3.05-trillion collection target for 2024.

Year on year, the BIR’s seven-month revenues jumped by 12.58% from P1.49 trillion in the same period a year ago.

At the same time, the Bureau of Customs (BoC) collections rose by 6% to P536.42 billion during the January-to-July period from P506.49 billion last year.

This accounted for 57.08% of the Customs’ P939.69-billion collection goal for this year.

For the first seven months of the year, revenues from the BIR and BoC — the National Government’s main tax collecting agencies — jumped by 10.89% to P2.22 trillion from P2 trillion a year ago.

A DoF statement said Finance Secretary Ralph G. Recto held a BIR and BoC command conference on Aug. 16 to assess the agencies’ performance and plans to meet the targets.

At the event, the DoF said the BIR committed to “bolster its digitalization programs, intensify its tax enforcement, and run after delinquent accounts.”

“The BoC will continue to improve on its assessment and collection of duties and taxes on importation, ensure importer’s compliance with customs’ laws, and strengthen border protection to detect undervalued and misclassified commodities,” the DoF said.

Mr. Recto said the government should boost collections as economic growth is expected to accelerate with the recent rate cut by the Bangko Sentral ng Pilipinas (BSP) and the credit rating upgrade by Rating and Investment Information, Inc. (R&I).

Last week, Japan-based R&I upgraded the Philippines’ investment grade rating to “A-” to reflect the country’s strong growth prospects. This was one notch up from the country’s previous rating of “BBB+” assigned in August 2023.

The BSP last week cut interest rates for the first time in nearly four years. The Monetary Board reduced the target reverse repurchase rate by 25 basis points to 6.25% from the over 17-year high of 6.5%. — B.M.D.Cruz

Safety and satisfaction

PHOTO FROM HONDA CARS PHILIPPINES

Honda’s Sensing technology and local dealerships are the City’s attractions

By Dylan Afuang

IN ITS MORE recent forms, Honda’s subcompact has captured some of the substantial feel and performance of its larger cars. Today, it now even boasts the Honda Sensing safety features first seen in the car maker’s luxury models. And once standard across the City sedan range, the suite of advanced and effective safety gadgets made its way to the refreshed City Hatchback.

Motoring media and content creators recently experienced how Honda Sensing keeps people in and around the vehicle safe during a drive with Honda Cars Philippines, Inc. (HCPI) officials, on twisty roads and highways up north while dropping by local Honda dealerships aboard the new City Hatchback in lone RS trim (P1.189 million) and the City sedans (P973,000 to P1.148 million).

By equipping its vehicles with Honda Sensing, the car maker expects motorcycles and cars will not get involved in accidents by 2050. Below is the bevy of features, which work thanks to radar and sensors found in the Sensing bundle.

Collision Mitigation Braking System (CMBS)

Adaptive Cruise Control (ACC, with Low-Speed Follow on select Honda cars)

Lane Keeping Assist System (LKAS)

Lane Departure Warning (LDW)

Road Departure Mitigation System (RDMS)

Auto High Beam (AHB)

Lead Car Departure Notification System (LCDNS)

With Sensing activated, the City sedans and Hatchbacks stayed within the lane markings and at a safe distance from other vehicles. Our journey began at Honda Cars Manila Bay, then led us to Honda Cars Angeles-Clark in Pampanga and Honda Cars Baliuag in Bulacan, and so we crawled through workweek traffic on the Skyway Stage 3 and cruised along NLEX.

CMBS applies the brakes when it senses an impending collision in the car in front, and the driver fails to stop the car in time. ACC works when traveling on highway speeds, keeping the vehicle running at a preset speed, and by automatically accelerating or decelerating the car, maintaining distance from the vehicle being followed.

LKAS, LDW, and RDMS, meanwhile, use sensors and radar to scan lane markings and road borders ahead to ensure the City stays in its lane. These systems inform the driver that the car has veered out of the lane or road either by sending subtle input or vibrations to the steering, or flashing warning lights and audible prompts in the driver display.

Once the sun sets or the City enters a tunnel, the subcompact’s headlights automatically illuminate its immediate surroundings. AHB, however, intensifies the brightness of the headlights upon sensing total darkness, but dims the lights in the presence of oncoming traffic to prevent them from being dazzled.

Finally, LCDNS works when the car is stopped. The system detects whether the vehicle in front has sped away, then flashes warning with accompanying sounds on the instrument cluster to prompt the driver to accelerate.

Located along MA Roxas Highway in the Clark Freeport Zone, Honda Cars Angeles-Clark boasts a panoramic window display that allows natural light to filter inside the outlet, and for the selection inside to be better seen from the outside. The outlet aims to serve customers from the Freeport Zone and Angeles, officials of the dealership said.

Honda Cars Baliuag, meanwhile, is located on the Doña Remedios Trinidad Highway of Bulacan. Beyond the usual vehicle display, customers, while enjoying coffee and sweet treats, can rest in a lounge that features a Japanese-inspired aesthetic. The lounge is set around greenery, torii gates, a fountain, and a pond.

Aside from ensuring safety in every journey, another reason for getting a Honda City (or any model from the brand) is the unique customer experience that comes with the purchase.

Fuel retailer Topline sets Nov. 15 for IPO, aims to raise up to P3.16 billion

BW FILE PHOTO

CEBU-BASED fuel retailer Top Line Business Development Corp. (Topline) has set a target date of Nov. 15 for its initial public offering (IPO), with plans to raise up to P3.16 billion.

Topline intends to offer up to 3.68 billion primary common shares, with an additional overallotment option of up to 368.31 million secondary common shares, at an indicative price of up to P0.78 per share, the company said in a statement on Sunday.

The company has submitted a registration statement and listing application to the Securities and Exchange Commission and the Philippine Stock Exchange (PSE) in connection with its planned IPO.

The proposed offer period is scheduled from Oct. 28 to Nov. 5.

According to the prospectus dated Aug. 2, Topline has appointed Investment & Capital Corp. of the Philippines as the issue manager, joint lead underwriter, and bookrunner for the IPO.

The company said it intends to use the proceeds from the offer for its “vertical expansion initiatives, working capital, and general corporate purposes.”

“With our accelerating growth in recent years in the fuel sector of the Visayas region, we are poised for the company’s historic milestone of listing on the PSE,” said Eugene Erik C. Lim, Topline’s chairman, president, and chief executive officer.

The PSE expects to have six IPOs for 2024. Three companies have conducted IPOs so far, one of which is a mining company while the other two are energy companies.

For the first half, Topline’s net income increased to P60.6 million from last year’s P20.8 million. The company’s gross revenues grew by 15% to P1.56 billion.

“Earnings from our commercial fuel trading boosted our sales in the first half with robust fuel demand in Metro Cebu and Cebu Province,” Mr. Lim said.

Topline’s commercial fuel trading operations cater to customers with requirements of at least 4,000 liters per order in transportation, construction, shipping, and mining, among others.

The company expects two fuel service stations to open this month, on track to meet its target of 10 operating service stations this year.

“Our expansion in the retail fuel market will further support our vertical integration plans, supporting Topline’s continued growth,” the company executive said. — Sheldeen Joy Talavera

The auto industry’s back, and it’s getting electric out there

For a majority of car buyers, hybrids, like this Toyota Corolla Cross, are proving to be the quickest way to go electric. — PHOTO BY KAP MACEDA AGUILA

You’d be surprised to know we’re outpacing several ASEAN neighbors

THE PHILIPPINE automotive market seems to be defying gravity. Overall, the ASEAN market is estimated to have declined by around 8% from January to June this year, compared to the same period last year. Indonesia — the biggest market in the region — is down by over 10%, while Thailand — formerly the largest auto market — has dropped by over 20%. Even Vietnam, which has been among the fastest-growing in recent years, is reporting slowdown of almost 10%. Malaysia registered a rise in sales, albeit by a more modest 5%.

In comparison, the Philippine market is up by 10% year on year, as of June 2024. There is a myriad of reasons for this growth: One is the still-robust economic expansion being experienced by the country; another is the rise of motorization. GDP growth of 6.3% in Q2 is the strongest it has been over the last five quarters. Unlike our neighbors, we have a consumption-driven economy — up to 70% of GDP. On the contrary, Thailand is dependent on exports — particularly to China, which itself is experiencing an economic slowdown. Indonesia depends on mineral resource exports that have been reined in by the government and have been, at the same time, affected by a slowdown in global demand.

The return of consumer financing by banks and financing companies has also been another macro factor in the surge of sales here. In contrast, the tightening of credit is seen as a deflating factor in Thailand where household debt of ฿16.3 trillion is equivalent to 91% of GDP. In the Philippines, the household debt-to-GDP ratio is only 12.6%. As such, credit access and availability is still expanding — thus driving car sales.

On the micro level, the entry of new car makers to the domestic auto market has also contributed to robust sales. As a Business Economics graduate, I learned the theory that “supply creates its own demand.” New model introductions and normalized supply chains by almost all brands — especially the Chinese — are also stimulating demand among car buyers. The expansion in model offerings in the market is proving to be very enticing, and a compelling reason to purchase, for many. In 2023, Chinese brands that are members of the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) reported sales of 22,140 units, accounting for 5% of the market. As of June 2024, their sales have reached 12,675 units, 5.6% of total sales and a growth of 14% year on year.

Drilling down even further, new market segments are opening up and driving emerging demand. For example, the jeepney modernization program of the government is creating a whole new category of public utility vehicles. There are reportedly around 250,000 jeepney units registered in the country, and this is fueling a new supply channel.

And then, of course, there is the nascent sector of electrified vehicles. While much has been said about the “inevitability” of electrified mobility, the path it has taken so far is still in flux, especially in the Philippines and other developing countries. Many of the automakers from China used their new energy vehicles (NEVs) to herald their entry into the local market. BYD is the latest to land on Philippine shores.

The thrust of the government to seed and grow electrified vehicles — hybrid electric vehicles (HEVs), plug-in hybrid electric vehicles (PHEVs), battery electric vehicles (BEVs) — is evident. In fact, it passed the Electric Vehicle Industry Development Act (EVIDA) that gave rise to the Comprehensive Roadmap for the Electric Vehicle Industry (CREVI). This legislation is aimed at stimulating investments, development, and usage of electric vehicles through various programs such as import tariff exemptions, exclusion from the Unified Vehicular Volume Reduction Program (UVVRP), and incentives for the development of charging networks.

Surely, the introduction and supply of electrified vehicles is — and will — stimulate a whole new demand stream that may further drive growth in the country’s auto market. Of course, a part of that will substitute demand for internal combustion engines (ICE). But the early adopters — due to the still relatively high price of EVs — will likely boost additional demand based on climate advocacy and the perceived advantages of EV use.

In 2023, CAMPI reported combined sales of 11,584 units for both HEV and BEV models, representing 2.6% of the total market. HEVs accounted for 95% of total EV sales, while BEVs comprised 5%. As of June 2024, total reported EV sales reached 9,238 units or almost 80% of the full-year figure for 2023. The split between HEV and BEV remains the same, but the EV segment now accounts for 4.1% of the whole market. Clearly, this is a fast-emerging segment. With the recent announcement that HEVs are now exempt from import tariffs (up to 2028), demand is expected to climb even more. Also, the first-half numbers do not include sales of BYD yet.

Toyota leads the electrified segment, accounting for almost 70% of total sales — 72.6% of the HEV category and 4.7% of the BEV class. Nissan is second with an 8.9% share, while Geely is third with a 5.8% share.

Toyota has been a staunch advocate of electrified mobility and the battle for carbon neutrality (CN), beginning its journey back in 1997 with the introduction of the Prius. It has since sold over 22.5 million electrified vehicles resulting in emissions reductions equivalent to what 7.5 million BEVs could have achieved. However, it has been pointed out that Toyota is seemingly slow to the draw with regard to the transition to BEVs.

Toyota believes that its development of EVs should be in pace with the appetite of car buyers to make the switch. There are three legs for electrification to succeed — the government, the car maker, and the customer. The government is responsible for creating the fiscal framework to promote sustainable mobility; the car maker is responsible for developing the vehicles and products. The customer, however, ultimately decides based on affordability, operability, and convenience.

Arguably, therefore, it is the customer who dictates the rate of adoption and, accordingly, the pace of EV development by car makers. So far, it seems that affordability and operability remain key barriers to a more rapid pace of EV adoption — particularly for BEVs. Range anxiety is a clear and present concern due to a still-limited battery-charging network. HEVs are better received since they are self-charging; they do not depend on charging stations and inordinate running downtimes. Prices of EVs are coming down — both for HEVs and BEVs — but are still at a premium over their ICE-powered counterparts.

In the journey to sustainable mobility, it is important to keep the whys of things in mind. The thrust to electrified motoring is not, arguably, because EVs are more fun to drive. They are not more affordable or cheaper in cost to produce; they do not create more jobs because, in fact, they have a significantly lesser number of components.

The ultimate goal of electrification is to battle greenhouse gases and achieve CN. As such, Toyota advocates for a multi-pathway to achieving this objective. After all, the war against carbon emissions should be technology-agnostic — focusing, instead, on embracing any technology that helps move the needle towards its goal, in line with the level of preparedness that countries can provide and that customers are willing to accept.

These include building a battery-charging network as well as transitioning to renewable energy so the battle for CN is won not only in the wheel well and tailpipe but also the oil well and power-generation plants. At this point, perhaps, HEVs are the most practicable and impactful option for the Philippines to pursue its sustainability goals. They are readily deployed, and they help in the fight for CN today.

There is no need to kick the can down the road any further.

Sustainable mobility does not have to be a one-size-fits-all journey. We do whatever it takes, and we should make sure no one is left behind. We are all in this together.

The author is the chairman of GT Capital Auto and Mobility Holdings, Inc., aside from his posts as Toyota Motor Philippines Corp. director and Lexus Manila chairman.

Treasury bill, bond rates may be mixed after BSP policy decision

BW FILE PHOTO

RATES of Treasury bills (T-bills) and Treasury bonds (T-bonds) to be auctioned off this week may end mixed after the Bangko Sentral ng Pilipinas’ (BSP) decision to cut borrowing costs for the first time in almost four years.

The Bureau of the Treasury (BTr) will auction off P20 billion in T-bills on Monday, or P6.5 billion each in 91- and 182-day papers and P7 billion in 364-day debt.

On Tuesday, the government will offer P25 billion in reissued 20-year T-bonds with a remaining life of 14 years and five months.

Yields on the T-bills and T-bonds on offer this week could track the mixed movements in secondary market rates after the BSP kicked off its easing cycle, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

Secondary market yields mostly declined on Friday after BSP Governor Eli M. Remolona, Jr. signaled another cut within the year, a trader said in an e-mail.

“We see healthy demand for [this] week’s 14-year auction amid a bullish market, with a current indicative rate of 6.05-6.10%,” the trader added.

At the secondary market on Friday, the rates of the 91-day and 182-day T-bills went up by 10.74 basis points (bps) and 0.96 bp week on week to end at 5.9503%, and 6.1152%, respectively, based on PHP Bloomberg Valuation Service Reference Rates data published on the Philippine Dealing System’s website.

Meanwhile, the 364-day paper went down by 4.88 bps week on week to yield 6.1489%.

For its part, the rate of the 20-year bond dropped by 5.43 bps to 6.2663%.

The Monetary Board on Thursday cut its policy rate for the first time in nearly four years amid an improving inflation outlook, with the BSP chief signaling at least one more reduction before the end of the year.

The BSP slashed its target reverse repurchase rate by 25 bps to 6.25%, as expected by nine out of 16 analysts in a BusinessWorld poll. Rates on its overnight deposit and lending facilities were also lowered to 5.75% and 6.75%, respectively.

This was the first time that the Monetary Board cut rates since November 2020, when it delivered a 25-bp cut amid the coronavirus pandemic.

Prior to Thursday’s move, the BSP kept its policy rate at an over 17-year high of 6.5% for six straight meetings following cumulative hikes worth 450 bps between May 2022 and October 2023 to rein in inflation.

“With inflation on a target-consistent path, the current macroeconomic outlook supports a calibrated shift to a less restrictive monetary policy stance,” Mr. Remolona said at a briefing.

The BSP chief said they could cut rates by another 25 bps before yearend. The Monetary Board’s remaining policy-setting meetings this year are scheduled for Oct. 17 and Dec. 19.

Last week, the BTr raised P20 billion as planned from the T-bills it auctioned off as total bids reached P52.535 billion, or more than twice the amount on offer.

Broken down, the Treasury borrowed P6.5 billion as programmed from the 91-day T-bills as tenders for the tenor reached P15.29 billion. The average rate for the three-month papers went up by 7.2 bps week on week to 5.9%. Accepted rates ranged from 5.878% to 5.929%.

The government likewise made a full P6.5-billion award of the 182-day securities as bids for the tenor reached P17.26 billion. The average rate for the six-month T-bill stood at 6.093%, up by 3.1 bps, with accepted rates at 6.074% to 6.1%.

Lastly, the BTr raised the planned P7 billion via the 364-day debt papers as demand totaled P19.985 billion. The average rate of the one-year debt inched down by 1.2 bps to 6.062%.

Meanwhile, the reissued 20-year bonds to be offered on Tuesday were last auctioned off on June 19, where the government borrowed just P24.003 billion out of the planned P30 billion at an average rate of 6.781%, 3.1 bps above the 6.75% coupon rate.

The Treasury wants to raise P220 billion from the domestic market this month. Broken down, it is looking to borrow P80 billion through T-bills and P140 billion via T-bonds.

The government borrows from local and foreign sources to help fund its budget deficit, which is capped at P1.48 trillion or 5.6% of gross domestic product for this year. — A.M.C. Sy

Pangilinan says Meralco open to increasing stake in SPNEC

MERALCO.COM.PH

MANILA Electric Co. (Meralco), through its unit MGen Renewable Energy, Inc. (MGreen), is open to acquiring a larger stake in integrated solar developer SP New Energy Corp. (SPNEC), the company’s chairman said.

“If it’s open, why not? It’s a good project. It owns 100% of Terra Solar for now, right? It’s the largest single-site solar facility in the world, and the Philippines should be proud of that,” Meralco Chairman and Chief Executive Officer Manuel V. Pangilinan told reporters on July 29.

MGreen is the renewable energy unit of Meralco PowerGen Corp., a fully owned subsidiary of Meralco.

“[The solar project] is a very complex [and] huge undertaking,” Mr. Pangilinan noted.

SPNEC, through its subsidiary Terra Solar Philippines, Inc., is currently developing the P200-billion solar power project, which is said to be the world’s largest solar farm.

The solar project is located in Nueva Ecija and Bulacan, consisting of a 3,500-megawatt solar power plant and a 4,000-megawatt-hour energy storage system.

The first phase is targeted for completion by 2026, while the second phase is expected to be finished by 2027.

In February, MGreen raised its stake in SPNEC, boosting the controlling interest of the company and its affiliates to 55.96% from 50.55%.

The acquisitions amounted to P20.2 billion, allowing MGreen and its affiliates to own 19.473 billion common shares of SPNEC, or 38.89% of the total outstanding common shares of the company.

Before these developments, Solar Philippines Power Project Holdings, Inc., owned by Leandro Leviste, held the majority stake in SPNEC.

Solar Philippines continues to own 18.993 billion shares of SPNEC, with other shareholders and the public owning the remaining shares.

Meralco’s majority owner, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera

MaArte expands in time and space

SHOES by Alexie Nethercott — MAARTEFAIR FACEBOOK PAGE

THE ANNUAL MaArte At The Pen is about to get bigger and longer: the bazaar would usually be three days of shopping with goods spread out over three floors of the hotel, but this year, they’re adding space and days to the enterprise.

The MaArte at The Pen Fab Finds bazaar will run from Aug. 29 to Sept. 1, Thursday to Sunday, from 10 a.m. to 8 p.m. Furthermore, it will be held at the 9th and 5th floors, the Rigodon Ballroom, the Garcia Villa and the Balagtas Rooms, and is expanding in two new locations at The Peninsula Manila Hotel — The Conservatory and Upper Lobby at the 2nd floor. 

Gemma Cruz Araneta, Vice-President of the Museum Foundation of the Philippines, Inc. (MFPI), and former Secretary of Tourism, told BusinessWorld in an interview during the Aug. 13 preview that the reason for the bigger spaces and the longer schedule was basically the bazaar’s popularity.

“Last year, we noticed that there were more exhibitors, and also more people came. It was kind of crowded. We figured if we had more days, then people can shop more leisurely, and they can come back [and shop for more].”

They also had to make room for the increased number of exhibitors: from 116 last year to 147 this year.

“They saw that this is really a good occasion to sell,” she said. “They believe in our advocacy, of course, and then, we also give them good terms.”

The bazaar is a fundraiser for the MFPI.

The exhibitors this year include designer Puey Quiñones, artisanal potter Joey de Castro, clothing brand Vara, and artisanal jeweler Kitsilver (who, during the preview, showed off a collection, called Calado, of jewelry modeled after embroidery).

“We really try our best to get the very enthusiastic exhibitors, and consistent in the quality of their products,” said Ms. Cruz Araneta. “They’re very proud that finally, we have these world-class museums… they know that all the funds that we raised are for the National Museum, so I guess that gives them satisfaction.”

Danny Jacinto, MFPI President and MaArte Committee Chair, told BusinessWorld that for the past two years, the foundation has been able to give scholarships and grants, pointing as an example the scholars they have sent to London, with a bill of about P6 million — which should give one an idea of how much money MaArte can actually raise.

As it celebrates 15 years, the MaArte fair brings with it a purpose — to spotlight the country’s endangered fauna such as the Philippine Eagle, crocodile, tamaraw, sea turtle, and tarsier.

One of the themes this year is sustainability, and Ms. Cruz Araneta elaborated, “As you may have noticed through life, people start industries of workshops, and then their problem is sustainability,” she said. She gave an example about the indigenous textiles and native crafts they will have on display. “To begin with, the materials are hard to come by; they want to be faithful to the old way or the traditional way of weaving. Then there’s a problem of the threads, the dyes… and also how to transmit this knowledge to the younger generation,” she said. “To be able to fulfill these factors, that really is a challenge.”

The triptych of the various high-end artisanal fairs of the city — MaArte, Artefino, and the Habi Fair; and due to their success, more are popping up — show off Filipino craftsmanship and where else it could go. Moreover, they provide accessibility to goods from all over the Philippines to the city-dweller, and serve as incubators for more exploratory brands and products. This has resulted in an ease of consuming local goods that benefit both the Filipino buyer and the maker, not to mention the soft power of seeing what the Filipino can do.

Ms. Cruz Araneta says, “It’s also such a joy to see how some of the exhibitors are able to incorporate the traditional to the contemporary.”

Asked how activities like theirs contribute to accessibility and appreciation for Filipino culture, she said, “The products are available. And you can see different stages, different types, from the very traditional and then the modernized ones. So you can have your selection.”

For updates, visit the MFPI and MaArte’s official social media pages on Facebook and Instagram or check out www.museumfoundationph.org. — Joseph L. Garcia

Our misguided energy policy

KARSTEN WURTH-UNSPLASH

On June 20, Raissa Robles wrote for the South China Morning Post an article headlined: “Blackouts, ballooning bills hammer Filipinos as energy crisis grips the Philippines.”

In response, Energy Secretary Raphael Lotilla attributed the power crisis to surging demand driven by an intense heat wave in April implying that the energy crisis would be short-lived.

Well, the heat wave has gone, and the rains have come. And yet we still have an energy crisis.

This is so because the cause of the crisis is not the surging demand driven by the heat wave but by the misguided energy policy adopted by our Energy Secretary.

The accompanying table shows the sources of the Philippine power supply. The table also shows the sources of supply, the amount in terawatt-hours and the percentage contribution.

In April of 2024, coal accounted for 63.34% of our supply, with natural gas at 16.45% and renewables (biomass, geothermal, hydro, solar and wind) accounting for 18.29%. Solar accounted for 3.80% and wind for 0.63%.

Alfonso Cusi, Energy Secretary under President Rodrigo Duterte adopted a Power Supply Plan which called for the transition from coal to renewables with natural gas as a bridge power source. Under the Cusi Plan, the contribution of coal would be reduced to 25% (from 63%), the share of natural gas would increase to 40% (from 16%), and renewables would increase to 35% (from 18%).

When Secretary Lotilla took office, he revised this plan and accelerated the transition to renewable energy. He increased the share of renewable energy from 35% to 50% and decreased the share of natural gas to 25% from 40%. Most significantly, he increased the share of wind power from 1.41% under Cusi to 17.11% (or from the current 0.78 terawatt hours or TWh in 2024, to 49 TWh in 2040, an increase of 63 times in 16 years).

This drastic revision of the Cusi Plan has several consequences.

For one, this disrupts the private sector plans for their natural gas power plants. The Lotilla Plan calls for transferring the 15% earmarked for natural gas plants to wind power plants.

As background, the natural gas power plants in the Philippines previously sourced their fuel, natural gas, from Malampaya. This is very convenient as the gas is merely piped from the gas site to the power plants. But now that Malampaya is depleting, these power plants will now have to import natural gas. Importing natural gas is a complicated process. If imported from Qatar, the natural gas must be converted to liquid through a freezing process. The liquefied natural gas (LNG) is then loaded onto special ships and transported to the Philippines. Upon arrival the LNG must be converted back to gas through a gasification process.

In sum, existing and prospective natural gas power plant operators need to have access to or own a gasification plant. Thus Aboitiz Power and San Miguel Power, who both operate natural gas plants, plan to create, in partnership with Meralco, the largest gasification plant in the Philippines. With the Lotilla Plan to reduce the share of natural gas as a source of power supply, the gasification plant risks being underutilized.

Additionally, the elimination of the natural gas power plants under the Cusi plan will greatly discourage efforts to extend the life of the Malampaya gas field as well as efforts to explore and develop new gas fields in the Philippines.

Another point and most importantly, natural gas has been planned as a bridging plant from coal to renewables or as a contingent plant in case the solar and wind power sources do not produce as expected and on time. The Lotilla Plan, by reducing the share of natural gas, increases the risk of an energy crisis and is thus misguided.

The ASEAN Center of Energy recently released a report entitled, “Assessment of the Role of Coal in the ASEAN Energy Transition and Coal Phase-Out.” The report notes that the 2040 phase-out faces significant challenges. The report cites the experience of Germany which took over 20 years and approximately $1 trillion for its energy transition. The report explains that the installed capacity of the renewable sources does not match the quantity or quality of the dispatchable energy from fossil fuel.

To elaborate, a coal plant with a rated capacity of 100 megawatts (MW) can realistically deliver 80 MW or an 80% utilization rate. On the other hand, a solar power plant with a capacity of 100 MW can only deliver 20 MW or a 20% utilization rate. The solar plant cannot operate at night and during rainy or cloudy days. Thus, to replace a 100-MW coal plant we need a 400-MW solar plant.

Not only that, the coal plant operates 24/7. To put the coal plant and the solar plant on a comparable basis, a battery plant must be included so that the solar plus battery plant can also operate 24/7. Presently, the cost of battery power is not low enough to replace coal. Thus, the resort to natural gas as we wait for the cost of battery power to decline to the point where it makes solar/battery power competitive with coal.

By the way, the claim that the cost of solar and wind power has declined is irrelevant to us the consumer. Under the feed-in tariff provisions, the providers of solar and wind power are guaranteed a fixed price for the next 20 years. Whatever savings are realized from the decline in the cost of solar and wind power goes to the power providers and not the consumers.

Moreover, under the Renewable Energy Act, renewable energy must be dispatched to the grid ahead of fossil fuel power. Logically, cheap and reliable energy such as that from fossil fuel is dispatched first; after this source is exhausted only then should expensive and unreliable energy as renewable energy presently is, be dispatched. This policy results in higher costs and highly unreliable power for consumers.

This probably explains why only the Philippines and Vietnam among all the countries in Southeast Asia are enthusiastic about wind and solar power as shown in the table.

However, the Philippine’s enthusiasm is so far reflected only in intention rather than in action as only a small portion of the proposed wind and solar plants are under construction.

An analyst has noted that the only area where the renewable companies are ahead of schedule are in their IPOs (Initial Public Offerings). Lately the stock prices of the renewable power companies have not performed as well as the fossil fuel power companies, indicating the judgment of the market that the prospects of the renewable power companies are not as bright as its proponents proclaim.

A possible reason for the pessimism is that the auction prices won by the renewable power companies in the bidding conducted by the Department of Energy are much lower than the prices awarded by Meralco to the fossil fuel companies.

There is therefore a risk that the proposed wind power plants which are supposed to be constructed in lieu of the natural gas power plants may not be constructed in time or not even at all, resulting in power shortages or at least higher power costs.

We argue that our present misguided energy policy be reverted to the Cusi Plan.

This happens when our Secretary of Energy abandons his job of assuring cheap reliable power and takes over the job of our Secretary of Environment and Natural Resources of dealing with climate change.

 

Dr. Victor S. Limlingan is a retired professor of the AIM and a fellow of the Foundation for Economic Freedom. He is presently chairman of the Cristina Research Foundation, a public policy adviser of Regina Capital Development Corp., and a member of the Philippine Stock Exchange.

Central bank eyes more incentives in sustainability financing push

BW FILE PHOTO

THE BANGKO SENTRAL ng Pilipinas (BSP) is looking to provide more regulatory incentives to encourage green and sustainability financing among banks.

In its latest Sustainability Report, the central bank said it will “explore other viable regulatory incentives to promote financing for adaptation and transition, with due consideration to moral hazard concerns and legality.”

“Such incentives may include relaxing certain regulations on BSP’s normal credit operations for refinanced green loans of banks,” it added.

The central bank last year approved the temporary increase in the single borrower’s limit of banks by 15% to allow them to extend loans or finance investments for eligible green or sustainable projects or activities, including transitional activities.

It also approved the gradual reduction of the reserve requirement rate (RRR) against sustainable bonds issued by banks. This year, the RRR is set at 1% for new and existing sustainable bond issuances.

“Moving forward, the BSP will be issuing guidelines for sustainability-themed unit investment trust funds (UITFs) by trust entities (TEs), which could help in broadening the range of sustainable finance instruments for retail and institutional investors,” it said.

The report showed that in the first half of 2024, banks’ peso-denominated sustainable bond issuances stood at P236.5 billion. Meanwhile, foreign-currency sustainable bonds amounted to $1.6 billion.

Total reserves generated from sustainable bonds issued by banks was recorded at P1 billion as of end-March.

“With the regulatory incentive provided by BSP, an estimate of P2 billion has been freed up to the system, which may then be reallocated to finance eligible and sustainable activities,” it added.

The central bank sees the issuance of sustainable bonds to rise further in the coming years. Data from a BSP survey showed that more respondent banks (90.3%) are planning to finance sustainable activities from 2024 to 2025.

Meanwhile, the BSP is also seeking to improve reporting standards to better monitor climate risks.

“The BSP will also enhance prudential reports that could facilitate identification and collection of relevant data and surveillance of emerging risks/trends arising from climate change and other environmental and social factors,” it said.

“This includes enhancement of the branch-level prudential reports to generate granular data that could be used to understand the loan profile of banks per province and region as well as assess the vulnerability of the banking system to climate physical risks and natural hazards.”

Under the BSP’s inclusive sustainability agenda, the central bank aims to promote a “climate-resilient financial system that facilitates inclusive adaptation and just transition,” as climate change and nature loss may pose risks to financial and price stability, it said.

“The country’s response to these risks necessitates mobilizing sustainable finance which the BSP can strategically support in line with its mandates,” the central bank said.

“Financial institutions may incur destabilizing losses in terms of defaults and impaired asset values from exposure to sectors/industries vulnerable to physical and transition risks. Such losses could constrain their ability to provide credit to the real economy.” — Luisa Maria Jacinta C. Jocson

JAC Motors introduces JS6 SUV

PHOTO FROM JAC MOTORS PHILIPPINES

JAC MOTORS PHILIPPINES recently introduced the all-new JAC JS6 five-seater SUV, which was previously previewed at this year’s Manila International Auto Show (MIAS) and is positioned as “one of the car maker’s most advanced and innovative models” at a competitive price point.

It is powered by a turbocharged 1.5-liter, direct-injection inline-four gasoline engine producing 182hp at 5,500rpm and 300Nm at 1,800 to 3,500rpm. The engine is mated to a six-speed dual-clutch transmission that is said to offer “instant performance and exceptional fuel economy.”

In front, the SUV bears high-mounted LED daytime running lights and quad-LED headlights which help to underscore “high-tech and modern styling cues with classic, elegant lines.” The JAC JS6 gets 160mm of ground clearance, a 20-degree approach angle, and 19-degree departure angle for tackling difficult terrain. It bears an upward-sloping beltline, full-length LED taillights, roof rack, and 18-inch alloy wheels, as well as premium features like power-folding side mirrors, panoramic sunroof, and powered tailgate.

Inside, the SUV features two 12.3-inch displays, one for the gauges and driver information, and another for the Apple CarPlay- and Android Auto-compatible infotainment system — hooked up to eight speakers.

The all-new JS6 is equipped with plush leather upholstery, electrically adjustable front seats, wireless charging pad, dual-zone climate control, 360-degree camera, 60:40 split-folding rear seats, six air bags, Isofix child-restraint anchors, and electronic stability program — in addition to advanced driver assistance system (ADAS) features: automatic emergency brake system, lane departure warning, frontal collision warning, blind spot monitoring, and intelligent remote light switch.

The JAC Group turns 60 this year. It was founded on May 20, 1964 as the Hefei Jianghuai Automobile Factory, with trial production of the first JAC truck starting in April 1968. Today, the company claims to have had over 10 million customers worldwide.

On Aug. 24, 2001, the rebranded JAC Motors was listed on the Shanghai Stock Exchange to signify its continuous growth. Its first multi-purpose vehicle then rolled off the production line on March 18, 2002, “laying a good foundation for the brand as it entered the passenger vehicle segment,” said JAC Motors Philippines in a release. The brand has “achieved notable success across various regions including North America, Middle East, Europe, and most recently, Australia, with the introduction of the T9 pickup,” and has completed partnerships with Volkswagen and NIO to produce battery electric vehicles, and with Cummins to supply a wide range of engines.

In the country, JAC offers a range of high-quality passenger vehicles through JAC Motors Philippines, itself a part of the local subsidiary of the Astara Group.

For more information about JAC dealerships and the product lineup, visit www.jacmotors.com.ph and follow @jaccarsph on Facebook and Instagram.

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