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EARLIER this year, I had been filling up my car with unleaded fuel
to the tune of P1,600 per full tank. Just this weekend, I gassed up
the same car and paid P2,100. That’s an extra P500, a whopping
30-percent increase in just a span of a few months. My only
consolation is that I drive a subcompact hatchback that yields 11
kilometers-per-liter to 12 kilometers-per-liter in city driving. I
have no idea what I would do if I actually owned an SUV or even a
larger sedan. If the fuel price increase continues—some say it
could hit P80 per liter well before the yearend—I might even have
to shift to a scooter.
This got me thinking: If this fuel-price crisis
continues—and it looks like it will—how will it shape the way
people buy their cars? Is this the final blow to the SUV’s chances
of surviving? What about sports cars? Are we entering an era where
our roads will be dotted predominantly by small cars and
motorcycles?
In the United States, the Detroit Big Three are
ready to throw in the towel for the gas-guzzling sport-utility
vehicle. General Motors announced last week it was shutting down
four truck/SUV plants staffed by 10,000 workers. It also said it
would look into the possibility of unloading the Hummer brand. With
fuel now costing four dollars a gallon, Americans are staying away
from low-mileage vehicles like SUVs and pickups.
Industry analysts also predict that—because of
high fuel prices again—the Ford F-150 full-size pickup will
finally lose its sales crown in the US after 26 years of continued
dominance. In May, four passenger cars actually sold more units than
the F-150: Toyota’s Camry and Corolla and Honda’s Accord and
Civic. Many are convinced that this is not a fluke, and that we can
expect the shift to smaller cars to stay for good.
But what about in our market? How will Filipino
car buyers react to the current fuel-price crisis? Auto industry
executives believe they have the answers. Allow me now to turn over
the space to these gentlemen.
Car buyers will be much wiser in purchasing a
vehicle. “The ongoing fuel price increase is a serious obstacle to
the growth of the industry,” states Nicky Mariano, general manager
of Motor Image Pilipinas (Subaru). “We are now experiencing a
market slowdown which can be attributed to this global crisis.
Consumers are now taking a second look at car purchases and studying
the best car that will serve their vital needs. The important thing
is not just the purchase price but also the total cost of ownership,
including servicing and daily upkeep of the car.”
People will defer car purchases. “Rising gas
prices will definitely impact car sales,” asserts Danny Isla,
first vice president for marketing of Toyota Motor Phils. “As
commodity prices rise, consumers will tend to consciously tighten
their spending, and buying second and third vehicles will likely
take a back seat. Purchases may be postponed until a semblance of
economic recovery is felt.”
Glen Dasig, assistant sales vice president of
Ford Phils., concurs: “There is a direct relationship between fuel
price and vehicle sales, and it comes in stages: reduction in car
usage to minimize fuel consumption, deferral of new car purchases,
and a possible long hiatus if fuel prices continue to rise. Effect
is not immediate, though, and we may see the change in customer
behavior during the latter part of the year.”
Luxury segment will not be affected. “The
high-end models will not be affected significantly,” says Butch
Gamboa, producer/host of Motoring Today and Auto Focus. “The
moneyed who buy them could logically take on the high cost of fuel.
Besides, their purchases are not based on need but on want.”
More people will prefer diesel-powered vehicles.
“At the moment, the auto industry has registered positive growth
for the year, but much of this growth has been due to diesel-fed
vehicles,” explains Art Balmadrid, corporate business vice
president of Isuzu Phils. Corp.
Adds Lito German, corporate communications
director of BMW Phils.: “I don’t believe that car sales will be
affected as a whole, although there will be more customer focus on
fuel-efficiency. This will be good for carmakers with fuel-efficient
cars, and that includes BMW because of the availability of diesel
engines in our lineup.”
Smaller-displacement engines will become
popular. “As an economic consideration, the fuel-price crisis will
make the market rethink its priorities,” points out Raymond
Tribdino, product planning and marketing manager of Nissan Motor
Phils. “Thus, preferences will change. It is my educated guess
that small-displacement engines and fuel efficiency will be the key
to sales.”
Motorcycle sales will further boom. “Soaring
fuel prices will cause a shift from big-displacement engines to
fuel-sipping low-displacement vehicles,” says Arnel Doria,
marketing vice president of Honda Cars Phils. “On the whole, sales
will not see much improvement in terms of volume, but motorbike
sales are expected to expand further, as motorcycles are a good
substitute to four-wheeled vehicles.”
Overall car sales will not drop, but people will
now be more prudent with their driving.“The increase in fuel
prices affects the auto industry in the same manner that it does
other industries,” says Dave Macasadia, managing director of Mazda
Phils. “People may hold off on purchases a little bit. But with
the industry results for the past three months, it looks like our
market is growing bigger—in fact, more than what we forecast last
year. I think the purchase of new vehicles will not drop, but people
will probably just schedule their trips more carefully.”
That is the same opinion of Albert Arcilla, CEO
of Viking Cars (Volvo), who argues that “the need to purchase
vehicles will continue as mobility is critical in our fast-paced
lifestyle. The soaring gas prices, however, will pave the way for
more discipline in how we plan our trips. They will also make us
learn driving skills and car-maintenance techniques that will
maximize the efficiency of fuel usage.”
The country’s economic growth will cancel out
the fuel inflation. “Auto industry sales have been expanding from
last year even with increases in fuel prices,” stresses Mel Dizon,
senior vice president for marketing of Mitsubishi Motors Phils.
“This is due to sustained economic growth, the need to re-fleet
with more fuel-efficient vehicles, and increased OFW purchases. How
strong is this sales resiliency? It depends on sustained economic
growth and how fast the industry can adjust to vehicle requirements
in the face of higher fuel prices.”
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