Vehicle sales continue to shrink

Car manufacturers said the government’s ongoing probe on the impact of imported vehicles on local jobs was keeping the largely import-dependent industry from better navigating its way out of the crisis as volume sales fell nearly 40 percent last August.

Truck and vehicle sales were down 39.5 percent in August to 17,906 units from 29,599 units in the same month a year ago, according to a joint report by the Chamber of Automotive Manufacturers of the Philippines Inc. (Campi) and the Truck Manufacturers Association (TMA).

This brought Campi and TMA sales—which account for most of the domestic auto industry— to a 47.6-percent decline in the first 8 months of the year to 123,489 units from 235,544 units in the same period in 2019.

Campi president Rommel Gutierrez said the Department of Trade and Industry (DTI) should consider the current situation of the auto industry under the pandemic as he stopped short of asking the latter to stop the probe on a possible safeguard duty.

“Economic recovery can be a gauge of the industry’s future performance, but it also depends on the policy environment. Any restrictive policies such as [a] safeguard duty will only limit the industry’s capability to navigate the current crisis,” he said in a statement on Monday.

The investigation—which covers the industry’s performance from 2014 to 2018—was prompted by a petition filed by labor group Philippine Metalworkers Alliance (PMA) last year.

PMA wanted the DTI to slap a safeguard measure against imported vehicles, arguing that a surge in imports have been hurting local jobs in a way that the automotive companies themselves were not.

In a global value chain, a car company that cuts its vehicle production so that it could import instead does not feel any significant loss. In the end, the group claimed, multinational companies would still benefit even if they began relying more on imports. Meanwhile, a smaller vehicle production means less work for local workers, which could then lead to job cuts.

Gutierrez did not say what the association wanted the DTI to do about the investigation, which was filed long before the pandemic. Instead, the statement simply said that the group hoped the DTI “will consider the impact of the pandemic on auto industry recovery.”

The DTI’s next step remains to be seen especially since the pandemic has hurt everyone —companies, workers and even the consumer market, although not everyone is equally equipped to recover.

Back in 2019, Trade and Industry Undersecretary Ceferino Rodolfo told reporters that there were only 153,000 brand new imported motor vehicles back in 2014. But this climbed to more than a million units by 2018. —Roy Stephen C. Canivel INQ