Automotive sales are expected to drop by at least 40 percent in 2020 to 250,000 units from last year’s sales of 416,000 units as the community quarantine reduced people’s mobility across the country.
Toyota Motor Philippines Corp. announced the revised projection during the virtual launch of the new Toyota Vios over the weekend.
“We are now setting a target 40-percent decline versus last year. Yearly market projection is around 250,000 to 300,000 units,” said TMP president Atsuhiro Okamoto.
Toyota did not provide a production forecast for 2020, although it said sales started to pick up in June and July.
Vios production is expected to be lower than in 2019, according to TMP vice president for marketing Jose Maria Atienza. The company plans to produce only 24,000 units this year, of which 14,000 units are variants of the new Vios.
Toyota has assembled more than 300,000 units of the Vios in the Philippines since the model was introduced in the early 2000s. This made the Philippines among the biggest Vios production hubs in ASEAN.
Vios is the best-selling compact sedan in the country, marketed as ideal for first-time car buyers because of its reliability and efficiency.
The company said it would be hard-pressed to comply with the production volume of Vios under the Comprehensive Automotive Resurgence Strategy program of the government amid the pandemic.
CARS, the government’s most ambitious automotive incentives program involving P600 billion worth of fiscal and non-fiscal perks, requires the production of 200,000 units of vehicles/models enrolled in the program.
“The target for CARS volume, as of now, will be actually difficult to achieve within the 2024 timeline. This COVID-19 pandemic has had sales dramatically drop this year and it will take some time for the market to really recover from original assumptions. Sooner or later, we will start negotiations with government on CARS,” Okamoto said.
The company said to make up for lost production in March and April, it would ramp up operations by doing double shifts starting September. The doubling of capacity will also double the output to as much as 200,000 units per annum.
TMP’s vehicle sales fell 41.92 percent in the first half to 35,648 units from 73,454 units sold in the first half of 2019.
Industry-wide sales also suffered a substantial decline in sales to 85,041 units in the first half this year from 174,135 units a year earlier.
The industry is counting on improved sales in the second half.
