Vehicle Sales On Decline Due To TRAIN
A few months after the implementation of the TRAIN law, the brunt of its effect has finally reached the automotive industry. The industry’s sales performance has dramatically plummeted in March, due to the higher excise tax on automobiles.
The Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI) rand the Truck Manufacturers Association (TMA) released a joint report showing a combined sales that skidded 23 percent to 28,216 units in March, pulling down the first quarter figure by 8.5 percent to 86,037 units from 94,026 units in the same period last year.
CAMPI president Rommel Gutierrez said in an interview:
“The decline in sales in the first quarter of 2018 is not unexpected. The impact of the change in excise tax rates under the TRAIN (Tax Reform for Acceleration and Inclusion) Law was anticipated for this particular period. We remain confident the market will improve in the coming months.”
However, the higher excise tax rates under the TRAIN Law was already expected to dampen industry sales this year, which is why a number of automotive companies to have forecast lower or flat sales for 2018.
A drop og 9.5 percent was also seen in both the passenger car and commercial vehicle segments in the first three months this year.
Almost half or 11 CAMPI and TMA members reported lower sales in the first quarter of 2018, one of these brands included the market leader Toyota Motors Philippines Inc. which posted a 15.4 percent sales decline during the three-month period. Other prominent automobile brands like Ford Motor Co. Philippines Inc., Honda Cars Philippines Inc. and Isuzu Philippines Corp. also reported sales decline during the period. Meanwhile, Mitsubishi Motors Philippines Corp., Nissan Philippines Inc., Suzuki Philippines Inc., Foton Motor and Hino Motors managed to sell more units.
Amid the slowdown in sales, Toyota remained the market leader in the first quarter with a share of 40.03 percent, followed by Mitsubishi (22.73 percent), Ford (7.49 percent), Honda (7.18 percent) and Nissan (6.72 percent).