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Despite the annual inflation rate rising to 6.1% in June 2022 from 5.4% in May, total new motor vehicle sales grew 26.8% to 28,601 units versus 22,550 units in June a year ago.

The joint report of the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and the Truck Manufacturers Association (TMA) recorded year-to-date June 2022 sales of 154,874 units, reflecting a 16.7% growth compared to the first semester last year. The data were confirmed by the sales report for YTD June 2022 of the Philippine Automotive Dealers Association (PADA).

Notwithstanding the impact of the higher prices of basic commodities on consumer confidence due to volatile fuel prices, the market for big ticket items like new automobiles seems to be gaining.

CAMPI president Rommel Gutierrez, who is concurrently 1st vice president of Toyota Motor PH, said that the upward sales growth trajectory in June was driven by the “pent-up demand from consumers and the less-than ideal economic conditions recorded in the same period.” He added that the industry is optimistic of sustaining sales in its current pre-pandemic trendline, although it will be challenging amid the ongoing headwinds to economic recovery.

Supply chain disruptions

The industry scuttlebutt is that more sales could be scored were it not for the supply chain disruptions caused by the lingering pandemic, plus the dire global shortage of the all-important semiconductor chips.

As AC Motors Automobile Group (Honda, Isuzu, Kia, Maxus, Volkswagen) president Antonio Zara told the Philippine News Agency, aside from the continued rise of fuel prices, delays in delivery of cars and auto parts challenge both the local and global auto industry. Because of the constraints in the supply chain, Zara said, it takes around three months for a car company to deliver a vehicle to a customer.

While Zara expressed cautious optimism that the supply chain problem would be resolved by year-end, a high-ranking executive of Nissan PH, Inc. told PDI Motoring that it would most likely extend up to 2023.

The delays don’t seem to be dampening consumer demand because in our country, especially in urban centers like the National Capital Region, the grossly inadequate public transportation system is forcing more people to buy cars. Commuting has become so dreary, exhausting and risky to one’s health (long lines under the sun or rain waiting to board buses, no physical distancing to avoid Covid infection, etc.), thus the surge in sales of small, entry-level, affordable vehicles, many of which are made in China or India.

The Top 10

Meanwhile, the rankings of the Top 10 sales performers in the first half of the year remained consistent with Toyota, Mitsubishi, Nissan, Suzuki and Ford comprising the Magic 5, and Isuzu, Honda, Geely, Kia and Foton occupying the second five perches (see chart.)

In PADA’s sales report for the first sem, “others” composed of various unidentified brands sold 3,804 units and is ranked as No. 9 among the Top 10, while in CAMPI’s Top 10 list, Kia is No. 9 with YTD sales of 2,345. In PADA’s list, Kia is No. 10 while in CAMPI’s, Foton is No. 10 with 1,831 units sold.

CAMPI does not include Geely in its sales reports because Geely is not a CAMPI member, but a member of the Association of Vehicle Importers and Distributors, Inc. (AVID). This makes Geely the only AVID member to make it to the Top 10 lists of CAMPI and PADA, replacing Hyundai, which sold only 176 units YTD June 2022. Significantly, AVID has not been releasing its quarterly sales reports.

Every month this first half of the year, Geely always managed to sell more units than its closest rival, Kia. Geely vehicles are imported from China and distributed by Sojitz G Auto PH (SGAP). Geely’s edge over other Chinese brands is its access to the newest cutting-edge technologies, having acquired both Volvo Cars and Lotus sports cars years ago, aside from London taxis.

In the small 4×2 SUV segment, the Geely Coolray ranks second only to the Toyota Raize with 282 units sold in June 2022 compared to 988 Raize units sold. This means that the Coolray captured 15.75% market share. In this segment, Geely beats the Kia entries as 245 units of the Kia Stonic were sold (13.7% market share), and only 17 of the Kia Seltos (0.9% market share.) The Honda HRV ranks 4th with 141 units sold in June (7.9% market share.)

In the midsize SUV segment, the Geely Okavango with 249 units sold in June beats the Nissan Terra (181 units sold), Isuzu Mu-X (169 units sold) and the Ford Everest (84 units sold.) The 7-seater Okavango thus clinched 8.0% market share in this segment, bowing only to the Toyota Fortuner (1,727 units sold) and the Mitsubishi Montero (649 units sold.)

SUMMING UP, so far the global supply chain disruptions and delays, and the short supply of semiconductors have not yet substantially cut down Philippine auto industry sales or dampened consumer demand for vehicles. However, more could have been achieved if there were no such shortages, so resolving these challenges sooner or later would mean full speed ahead for the industry toward pre-pandemic sales levels.

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