“The auto industry ends 2007 surpassing the 108,000 sales target by over 9,900 units with final industry sales of 117,903. For the first time in 10 years, the industry finally surpassed the 100,000 benchmark.”--says Elizabeth Lee. Overall growth registered a robust double digit 18.4% increase from the previous year brought about by such positive factors that include a large line up of new model introductions for the year from most auto players, improvement in economic growth with relatively stable business environment, the finality of the Supreme Court decision banning second hand vehicle importation with a more active government campaign against illegal vehicle imports. Average monthly sales for the year was 9,825 against only 8,292 in 2006.  December posted a 15.2% increase vs. November.

Contributing to the overall growth is the  Passenger Car segment with a sustained 7.1% growth for the year selling over 3,400 units per month.  As expected, December sales registered a growth as well of 4.2%.

CV sales of 76,690 units continues to dominate the market with a strong double digit growth of 25.6% for the year. With over 6,300 commercial vehicles sold per month in 2007, the sales numbers continue to validate the demand for utility vehicles which compose the majority of this type of vehicles in the segment. December sales contributed to a high sales growth of 21.2% versus November. New model introductions in the last quarter further boosted sales. Majority of vehicles in the CV segment cater to the increasing buyer demand for utility vehicles that double as both a workhorse vehicle used for business as well as a vehicle for family use. This demand trend is seen to continue in the near term.

New models for the AUV segment continued to support the strong growth with a  31,996 unit sales for the year yielding a notable 27.4% growth due to continuous demand on AUV diesel models. Month on month sales posted a significant 33.5% increase due to completion of new fleet deals.
Sales of the LCV segment continued to be the biggest in terms of volume in the CV segment with 41,692 units sold for year 2007 yielding a 24.7% increase over 2006. A monthly average of over 3,400 vans, pick up trucks, and SUVs were sold monthly  in 2007 . These popular vehicles continue to be the heavyweights in the industry. The segment is a consistent performer and a major contributor to growth for CV sales. December sales weighed in at 12.4% growth contributing much to year-end figures for the segment.

Light Trucks sales sustained its growth with a significant increase of  23.6% compared to the same period last year. For December, this segment increased by 35.2% versus November due to fleet sales deliveries.

Another CV segment which continued to move forward is the Cat IV & V, truck& bus category which posted a growth of  9.9% compared to the same period last year (Jan-December 2006).Growth was mainly driven by sales of the front and rear engine bus models.For the month of December, Cat. 4 increased by 8.5% due to increase in fleet requirements and deliveries.

Projections:  CAMPI will be meeting on the 14th for official 2008 projection. Prelim comments for 2008 outlook is as follows:

“Off the bat, we are still looking at a growth for 2008 with perhaps a more conservative stance at the onset with a 5-7% growth compared to 2007. Barring any untoward event, the industry seems to be on a more systematic growth path.  2008 will see a number of new models coming in through the year though the greater number of models have already been introduced last year. Still, recent and newly introduced models will take up most of the sales growth for 2008. The industry is seen to keep the momentum of growth in 2008 as well.

Drivers for growth for 2008 will depend on an increasingly stable market with forex rate fluctuations kept to a comfortable level. Trust in the will power of government agencies to stick to the strict implementation of the ban on used vehicles will certainly have a positive effect on sales as buyers gain greater awareness of the consequences of the ban. Other drivers will include the government’s initiative and growing focus on support for SME’s and OFWs. Support for the growing middle class will have a greater impact on the purchase of vehicles most especially those utility vehicles that double as a family and/or business vehicle.

The commercial vehicle (CV) segment will continue to dominate the market with greater emphasis on the LCV or light commercial vehicles, most of which are used for both personal and business use, though passenger car sales will also see an increase for those looking to buy small affordable cars. With the rise in oil prices, diesel fed vehicles can have a relative advantage in terms of fuel economy.
As economies increasingly become more integrated, the effect of what happens globally in general, and in the United States in particular may have an effect on our local economy. There is a growing sentiment that the US may experience a recession. Though perhaps one of many ways to lessen the effects is to strengthen economic fundamentals to support our local economy coupled by a consistent and growing stream of inflows from OFW remittances which continues to lift Filipino households and strengthen their purchasing power.

On the whole, 2008 is seen to be another growth year for the industry,” said Elizabeth Lee.

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