Hyundai sales skid on tax, inflation

MANILA, Philippines — Sales of the official distributor of Hyundai vehicles in the country slid eight percent in the seven months to July this year from a year ago on continued weak appetite for cars amid rising inflation and higher taxes on automobiles.

In a statement, Hyundai Asia Resources Inc. (HARI) said it sold 19,236 units as of end-July, down from the 20,960 units in the same period last year.

“The Philippine economy is still at its transitory phase as a result of all the reforms rolled out by the current administration. A continually rising inflation, the devaluing of the local currency, increasing world oil prices, and the excise tax put on automotive vehicles have influenced the market to hold on to their purchase of big-ticket items,” HARI said.

Passenger car (PC) sales reached 12,487 units in the seven-month period, 14.5 percent lower than the 14,603 units the previous year.

Light commercial vehicle (LCV) sales, meanwhile, grew 6.2 percent to 6,749 units in the January to July period from 6,357 units a year ago.

For the month of July alone, HARI’s total sales declined 8.8 percent to 3,279 units from 3,594 units last year.

PC sales in July fell 35.7 percent to 1,649 units from the previous year’s 2,564 units.

On the other hand, LCV sales rose 58.3 percent to 1,630 units in July from 1,030 units a year ago.

HARI said the LCV segment was boosted by the introduction of the subcompact sports utility vehicle Kona.

While overall sales were lower year-on-year, HARI said it is optimistic vehicle sales would stabilize in the coming months as the market adjusts to the transitory effects of the reforms introduced by the government, including the first package of the Tax Reform for Acceleration and Inclusion (TRAIN) law which slapped higher taxes on vehicles.

HARI also said demand-side factors such as positive business and consumer confidence and increasing investments for the government’s Build Build Build program for infrastructure development would be enough to balance out any perceived negative outcomes in the economy.

“In the midst of all the uncertainty faced by the automotive industry, Hyundai has proven itself to weather the odds with its strong start in the second half of the year. Expect more to come for the rest of 2018 as we will not let this ‘Kona moment’ pass us by,” HARI president and chief executive officer Ma. Fe Perez-Agudo said.