Business Development Asia LLC
South East Asian Automotive News
ISSUE 2, AUGUST 1997
PHILIPPINES
General Motors is reintroducing its car models in the Philippines after an 11-year absence. Erhard Spranger, executive director for sales of GM Asia Pacific, said GM's re-entry into the Philippine market is part of its regional strategy to capture a 10% share of the Asian-Pacific car market by 2006. Two Opel models, the Vectra and the Omega, will be launched by the end of July. GM established Thailand as its regional base in 1996, having also looked carefully at the Philippines. (July 7th, 1997)
Philippine passenger car sales fell 7.8% year to date against 1996, to 40,478 units in 1997. The Chamber of Automotive Manufacturers of the Philippines said that the downturn in sales was a "technical correction of the market due to accelerated selling" last year. The biggest seller among car assemblers, with 7,945 unit sales for the first six months of the year, was Honda Autocar which also assembles the Mazda, Subaru, and Kia brands. (July 10th, 1997)
The Philippines' Board of Investments plans to relax restrictions on imports of partially assembled cars to encourage the entry of more foreign vehicle manufacturers. Under the existing guidelines, assemblers are allowed to import semi-knocked down (SKD) units for one year from the start of their assembly operations. After the prescribed period, they can import only completely-knocked down (CKD) units. The proposed revision will allow local car parts manufacturers to import SKD units at any time, providing at least 50% of the models produced are re-exported (the minimum is set at 70% for foreign companies). The proposal also seeks to raise import tariffs on CKDs from 3% to 10%. Local firms oppose the planned revisions, warning they will make imported units much cheaper and consequently dampen sales and hurt profit margins. (July 5th, 1997)
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