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Industry Overview: Philippines Automobile Industry

Automotive Industry has played an imperative and indispensable role in the development of the Philippines as it has grown substantially and strongly over the past few years. According to the Motor Vehicle Parts Manufacturers Association of the Philippines, Inc. (MVPMAP), the automotive manufacturing industry belongs to the industrial sector which accounts for 31.5% of the total GDP. With an output value of Peso 368 billion, the auto industry contributes about 12% in the Industrial sector and 3.8% of the total GDP.

Total motor vehicle sales grew 11% in 2012 and exceeded sales target by a modest 1.7%, data from the Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI) showed. The CAMPI sold a total of 156,649 units in 2012 or 11% higher than the 141,170 units sold in 2011. It also surpassed its sales target of 154,000 units in 2012.
 
Based on the CAMPI sales alone, all vehicle segments improved their performance. The commercial vehicle (CV) segment contributed the biggest with total sales of 108,324 units or 12.2% more than the 96,588 units sold in 2011. CV sales accounted for 69% of total sales. The passenger car segment grew 8.4% to 48,328 units from 44,582 units or 30.85% of the market. The biggest improvement came from the trucks and buses vehicle category with 39% increase as sales hit 1,500 units from 1,079 units. The Asian utility vehicle category sold a total of 40,231 units or 12.2 % higher than the 35,851 units in 2011. By category, sales of light trucks were the biggest with 64,261 units or 11.2 % higher than the 57,796 units sold in 2011. CAMPI's sales got a strong boost from the record sales in December of 15,369 units, which is 48 % higher than the 10,358 units sold in 2011.
 
In terms of players, Toyota Motor Philippines Corp. dominated the market with a share of 42% having sold 65,396 units, followed by Mitsubishi Motors Philippines Co., with 22% with 34,915 units, Honda Cars Philippines Inc., with 8% for selling 12,653 units and Isuzu Philippines Corp. with 7.51% for 11,759 units sold. Leading companies including Toyota Motor Philippines Corp. (TMP) is expected to introduce its smaller models in the Philippine market to take advantage of the growing sales in the small car segment. TMP, which enjoys the largest market share among the country's automobile importers, sold 65,400 units in 2012 and is aiming for sales of at least 70,000 in 2013. Also, Suzuki Philippines Inc. sees a 10% increase in motorcycle sales along with a 20% hike in vehicle sales as it opens more dealerships and brings new models into the fast-growing Philippine market.In 2013, Japanese manufacturer aims to sell more than 100,000 motorcycles from the 94,000 sold in 2012.
 
MVPMAP expects motor vehicle production to hit 213,000 units by 2016. This year, MVPMAP projects local automotive production from completely knocked-down (CKD) to hit 90,000 units, increasing 15% annually to hit 350,000 units in 10 years or 2022 for the domestic market. Local production was estimated at 67,000 units in 2011. They also project exports of completely built-up units in two years starting off with 12,000 units by 2013 and growing to 156,000 by 2022.
 
The Automotive Industry in Philippines is expected to grow at a very fast pace in the foreseeable future. As per industry forecasts, by 2016 motor vehicle production is expected to hit 213,000 units. MVPMAP also projects local automotive production from completely knocked-down (CKD) to hit 90,000 units, increasing 15% annually to hit 350,000 units in 10 years or 2022 for the domestic market. They also project exports of completely built-up units in two years starting off with 12,000 units by 2013 and growing to 156,000 by 2022. This confidence is based on strong sector fundamentals which include projected high rate of GDP growth for the economy along with a very large upwardly mobile middle class population with aspirations for better living standards.
 
(Source: Insight Alpha)
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Motor Vehicle Parts Manufacturers Association of the Philippines, Inc. (MVPMAP)