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Remember Vision 2020?
Vision 2020 was the Philippine automotive industry’s dream of selling 500,000 motor vehicles by year-end 2020.  The dream looked doable at the close of 2016 when the industry posted 417,356 total vehicle sales, and even more reachable when sales surged to 476,073 by year-end 2017.
Then along came the TRAIN (Tax Reform for Acceleration and Inclusion) law raising the excise tax on new car sales effective January 1, 2018, followed by a 5.2% spike of the inflation rate in June, which soared further to 6.7% in September — all accompanied by almost weekly fuel price fluctuations.
Result: total vehicle sales slid to 382,361 units year-to-date (YTD) December 2018 versus 476,073 in 2017, according to a consolidation of the year-end sales reports of the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI)/ Truck Manufacturers Association (TMA) and the Association of Vehicle Importers and Distributors (AVID).
Nonetheless, after the inflation rate and fuel price volatility eased in December 2018, industry leaders became cautiously optimistic and forecast a 10% growth in 2019.
By adjusting their marketing strategies and introducing new models to overcome the impact of TRAIN and high inflation, industry players sold a grand total of 412,106 vehicles in 2019, thus surpassing the 410,000 sales forecast and ending the year with positive figures after the double-digit decline in 2018.
At this point, Vision 2020 was no longer being mentioned although a path to growth had been re-established and the industry looked forward to expanding it.

On January 12, 2020, Taal Volcano erupted, which could have been perceived by the superstitious as a portent of worse things to come.  The worst did come, when the COVID-19 outbreak forced the government to lock down the National Capital Region and surrounding provinces in mid-March, cutting off all economic activity including the operations of the auto industry.
By now, the adjustments that the car companies quickly made in order to survive, when lockdown restrictions were gradually lifted and businesses were allowed to partially reopen, are well-known: accelerating the transition to contact-free digital solutions for marketing, retailing and after-sales service, creating attractive virtual showrooms to make car-shopping a safe experience, resorting to imaginative marketing gimmicks and drastic sales promos to jumpstart sales, launching new or refreshed models online.
After a dismal first quarter, sales surged from May to July, dipped in August when the stricter Modified Enhanced Community Quarantine was re-imposed for two weeks, then regained momentum with the General Community Quarantine in September when CAMPI/TMA reported a 37% growth from the 17,500 units sold in August to 24,523 in September.
Meanwhile, AVID reported a 212% jump in sales from 4,955 units sold in the second quarter to 15,471 in the third quarter.
Just the same, sales were nothing near pre-pandemic levels and  industry leaders accordingly dialed down the industry’s sales forecast for 2020 from 420,000 to a realistic 240,000 units.
In October, CAMPI posted its highest sales volume with 25,023 units sold and although it was only a 2% growth over September’s sales, CAMPI president Rommel Gutierrez said the industry was on track to achieve its revised sales forecast of 240,000 units, the baseline for their medium-term recovery plan.

Last week, CAMPI/TMA and AVID released their YTD fourth quarter 2020 sales reports.  
CAMPI/TMA posted a double-digit growth of 19% in December to 27,596 units sold versus 23,162 sold in November.  Gutierrez, who is concurrently 1st vice president of Toyota Motor PH Corp., attributed the rise in sales to the holiday season and the improving business and consumer confidence.
But compared to the 33,715 units sold in December 2019, it reflected an 18% decline. 
Meanwhile, AVID finished the year with 5,683 units sold in December, a 15% increase versus the previous month. While AVID president Ma. Fe Perez-Agudo saw this as indicating a slow but steady recovery coming from “the most challenging period in the PH automotive industry,” she acknowledged that the YTD 2020 sales figure of 51,718 units was a 41% drop compared to the 87,169 vehicles AVID sold in 2019.
“Automotive was among the hard-hit sectors in the pandemic and we continue to feel the impact as sales, after-sales and auto-related services remain lackluster,” Agudo, who is concurrently president/CEO of Hyundai Asia Resources, Inc. and Changan Motors PH said.

 Although the auto industry has survived the most horrific year in its history, and some signs of revival are finally seen, “we see more headwinds in the coming months,” Agudo cautioned.
She pointed out that vehicle importers and consumers will soon feel the impact of the additional P70,000 tariff for passenger cars and P110,000 for light commercial vehicles that the DTI has decided to impose as provisional safeguard duties on imported vehicles.
The proposed safeguard duties will affect CAMPI as well as AVID since more than 90% of the motor vehicles that CAMPI members sell are imported.
That’s the bad news.  The good news is that if we combine the YTD 2020 grand total sales figures of CAMPI/TMA and AVID, the industry’s revised sales target of 240,000 for the year will be surpassed.
CAMPI/TMA reported a total of 223,793 vehicles sold, while AVID posted 51,719.  Before summing up the two figures, we must subtract the sales figures of Ford Motor PH, Inc. (14,775) and Suzuki PH, Inc (15,515) since the two carmakers are members of both CAMPI and AVID.
Do the math:  223,793 + 51,719 = 275,512 minus 30,290 (the sum total of Ford’s and Suzuki’s sales) = 245,222.
Still, 245,222 is way below the 412,106 of 2019.
Goodbye, Vision 2020! 
But with the revised sales target for 2020 achieved, the medium-term recovery plan’s baseline can now at least move forward.

*Chart is a corrected file of the today’s print version

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