Philippines seen as among growth markets for motor vehicles
MANILA, Philippines—The Philippines is listed as one of the high-growth motor vehicle markets among the Association of Southeast Asian Nations which, as a group, is expected to be the eighth-largest automative market in the world by 2015.
Vivek Vaidya, a vice president at research and consulting firm Frost & Sullivan (F&S), said in a report that manufacturers and suppliers should look at Asean as an alternative production base to China and India, currently considered as the places to be.
Vaidya’s report dubbed “Asean: The Final Frontier,” describes the region’s untapped potential as a market for vehicles and parts.
The report also recognized the Philippines as a regional supply base of transmission and universal joints in Asean.
Vaidya said that Asean would climb up by a notch to become the eighth-largest largest market in the world with unit sales rising to 3.14 million in 2015 from 2.23 million in 2010.
By then, Asean will join the ranks of the so-called BRIC countries – Brazil, Russia, India and China – as well as traditional stalwarts United States, Japan and Germany.
Further, Vaidya said Asean would retain such rank for at least the next three years through 2018, when sales could reach 3.63 million units.
Asean has been an untapped region with Japanese original equipment manufacturers having more share of each country’s market than in Japan itself, he said.
Vaidya pointed to Indonesia and Thailand as the key Asean growth markets, with Indonesia being likely to become the low-cost hub thanks to strong government support aside from relatively lower costs of labor and manufacturing.
Even then, he added the Philippines to make up a three-country “rapid growth zone” in terms of the number of vehicles compared to population as well as per capita gross domestic product.
F&S data show that compared to Thailand and Indonesia, the Philippines has the highest vehicle penetration but the lowest average income per person.
In terms of affordability, Filipinos find it easier to purchase a vehicle than Indonesians but find it harder compared with Thais.
Vaidya said Asean has become a growth market for passenger cars, particularly sub-compact and compact sedans.
