THE Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) is projecting higher vehicle prices amid the depreciating peso, but the industry is staying optimistic ahead of rising demand towards year-end.
CAMPI President Rommel R. Gutierrez said the weaker local currency would affect the operations of the local automotive industry, including the costs and prices of vehicles.
“With the depreciation of the (Japanese) yen and the (Philippine) peso, definitely it will increase our costs. So that will have an impact on even the price perhaps, then we will have to adjust the price if really the impact is so big,” Mr. Gutierrez said in an interview on the sidelines of the 8th Philippine International Motor Show (PIMS) in Pasay City on Thursday.
“Definitely it (weaker peso) has an effect on our operations because we still import parts and components and even the completed units. So any change in the foreign exchange definitely has [an] impact on the automotive industry,” he added.
On Thursday, the peso closed at P57.16 versus the US dollar, losing five centavos from its P57.11 close the prior day, based on data from the Bankers Association of the Philippines.
The local currency reached a new record low on Sept. 8 after it closed at P57.18 per US dollar.
Despite the peso’s decline, Mr. Gutierrez said that he remains optimistic about the local industry’s recovery, adding that stronger demand is expected during the holiday season.
“We also have adjusted to some exchange rate volatility. We will manage our adjustments. But we are still optimistic,” he said.
“Normally [in] December, towards the end of the year, sales are picking up. We are happy that as of now, recovery is doing good and we hope that this will continue until the end of the year,” he added.
Meanwhile, Mr. Gutierrez said the declining peso has some positive impact on local car brands through vehicle parts and components exports.
“The export of the auto industry only involves parts and components. We do not export completely built-up units. It’s not as big as the imports that we do. If there is, it’s still positive, at least for the export of parts and components. But it is not that big,” Mr. Gutierrez said.
He expects sales to reach pre-pandemic levels by next year.
CAMPI previously announced that it was aiming to sell 336,000 units in 2022, up by 17% from the 268,488 units sold in 2021.
In the eight months to August, the local industry sold 212,872 units, marking a 25.1% improvement from 170,112 units sold in the same period last year, based on the latest industry data.
“Pre-pandemic levels was really more than 400,000 units sold. We think it’s just a matter of time — maybe next year we will be able to reach the pre-pandemic levels. We are confident that we will reach our target [this year],” Mr. Gutierrez said.
“The supply is improving and consumer confidence is there,” he said, adding that promos are being implemented. “The models being introduced are already impressive.” — Revin Mikhael D. Ochave