Car importers dealt double blow in January | Inquirer Business

Car importers dealt double blow in January

/ 05:12 AM March 06, 2020

A group of vehicle importers suffered a 16-percent drop in unit sales in January, as it struggled to cope with the impact of two unexpected problems at the start of the year—the Taal eruption and the COVID-19 outbreak. The Association of Vehicle Importers and Distributors Inc. (Avid) said in a statement on Wednesday it only sold 5,433 units in January, fewer than the 6,482 units sold in the same month last year.

The group represents 25 automotive brands, but it only accounts for a small slice of auto sales in the Philippine automotive industry.

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Nevertheless, Avid still suffered the most compared to the Chamber of Automotive Manufacturers of the Philippines Inc. and Truck Manufacturers

Association, which account for most of the auto industry. Sales from the car and truck manufacturers dropped nearly 12 percent to 23,723 units in January. Avid president Ma. Fe Perez-Agudo said, “2020 will be a very challenging year for the industry given the slowdown in automotive demand, supply chain disruptions and dampened consumer confidence caused by these twin events.”

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“Fortunately, the Philippine economy remains strong backed by robust public spending, private consumption and lower interest rates,” she said, confident that Avid members would eventually bounce back.

Sales across all Avid segments dropped. Passenger car sales dropped 31 percent to 1,553 units, while light commercial vehicles dropped 7.3 percent to 3,855 units. Commercial vehicles, which only consists of Hyundai units, dropped 63 percent to 25 units.

Back in 2018, the industry was also hit by a huge drop in volume sales, as demand fell under the weight of the Duterte administration’s higher excise coupled with high inflation rates. New problems are also on the horizon as imported vehicles from certain countries might eventually become more expensive as a result of new trade policies.

The Department of Trade and Industry (DTI) is investigating the claim of a labor group that too many imported vehicles in the past few years were already hurting local jobs. —Roy Stephen C. Canivel

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TAGS: (COVID-19) outbreak, Association of Vehicle Importers and Distributors Inc. (AVID), Taal eruption, vehicle importers
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