Vehicle sales fell 24.1 percent in July, marking the biggest year-on-year decline under the weight of the the TRAIN law, official data from vehicle manufacturers showed.
Sales dropped to 28,038 units that month, significantly lower than the 36,951 units sold in July last year.
This was according to the joint data of the Chamber of Automotive Manufacturers of the Philippines Inc. (Campi) and Truck Manufacturers Association (TMA) released on Friday.
The figures pointed to a 14.4-percent decline in the first seven months of the year, with the industry selling 199,628 units compared to the 233,115 units in the same period in 2017.
No explanation was given behind the decrease, which surpassed the month of March in terms of having the largest year-on-year decline so far for 2018. March saw its year-on-year sales fall 22.8 percent.
However, the industry has been struggling to cope with the impact of the TRAIN law, the first tax package passed under the Duterte administration that slapped higher excise tax rates on most cars since the start of the year.
Seven months under the weight of the law, it remains to be seen when the industry would be able to break the trend of falling sales, which began last February.
The tax reform law lowered personal income taxes but imposed higher consumption taxes on goods such as sugary drinks and automobiles.
On top of this, Campi president Rommel Gutierrez previously blamed the decline in vehicle sales as a consumer reaction to inflation, which reached a record high in nearly a decade.
He explained that consumers might have been prioritizing basic goods and services more, as opposed to buying motor vehicles, amid the rising inflation.
The industry only expects to reach a flat growth at the end of the year, mostly due to the effects of the TRAIN law, he added.
Passenger car sales dropped 45.1 percent to 6,975 units in July this year from the 12,701 units sold in the same month in 2017.
From January to July, this segment fell 21.1 percent to 63,004 units, down from the 79,881 units sold in the comparative period last year.
Commercial vehicles, on the other hand, sold 21,063 units in July, a 13.1-percent drop from the 24,250 units sold in the same month a year ago.
This brings the segment, which accounts for more than 65 percent of the market, to a 10.8-percent drop in sales in the Jan. to July period.
It sold 136,669 units year-to-date, lower than the 153,234 units sold in the comparative period a year ago.
Toyota Motors Philippines Corp. was still the market leader for the first seven months of the year, but even the country’s largest volume seller suffered a 17.9-percent drop in sales.
Mitsubishi Motors Philippines Corp., which had the second largest sales year-to-date, fell 5.6 percent.
However, Nissan Philippines, Inc., which ranked third, saw its sales increase by 25.2 percent, going against the trend of the market.