Outlook promising as market shifts to eco-friendly, tech-laden cars
The automotive industry is looking forward to another banner year in 2025, driven by the advent of new energy vehicles (NEVs), government incentives, and aggressive marketing and promotional gimmicks maxed out by car makers themselves.
The prospects are so promising that the Chamber of Automotive Manufacturers of the Philippines (Campi) expresses confidence that its members will exceed the target of 500,000 unit sales for this year from about 467,000 in 2024.
“Industry sales performance in the first two months of the year is a clear indication that we are off to a good start,” Rommel Gutierrez, president of Campi said in an email interview.
Data from Campi and the Truck Manufacturers Association (TMA) of the Philippines showed vehicle sales rising by 6.4 percent during the first two months of the year. Combined sales reached 76,768 units, compared to 72,132 in the corresponding period in 2024.
In 2024, total vehicle sales reached 467,252 units, up 8.7 percent from 429,807 units a year earlier.
Commercial vehicle (light trucks) sales rose 8.1 percent to 346,482 units from 320,543 units year-on-year, accounting for 75 percent of total sales.
Passenger car sales grew 34 percent to 120,770 units from 109,264 last year. However, this segment accounted for only 25 percent of the total vehicle sales last year.
Vans and pick-ups dominated the space for commercial vehicles, which brought in 253,412 units, up 2 percent.
In a separate interview, Edmund Arraga, president of the Electric Vehicle Association of the Philippines (EVAP), said the group is ”very optimistic” about the potential growth in auto sales, as the market now offers many new options for consumers.
Market leader Toyota Motor Philippines (TMP) shares the upbeat mood. “We are encouraged by the entry of additional players into the Philippine automotive industry, as this would contribute to the further growth of sustainable mobility. In 2024, the automotive industry grew by 8.7 percent, and we expect this to be sustained this year,” TMP said in a statement in response to MBI’s emailed questions.
Way forward
Arraga said sport utility vehicles (SUVs) will remain the popular choice of consumers.
However, he added that pickup and utility vehicle sales will gain traction due to their versatility for personal and business use.
In an earlier interview, Gutierrez said several factors, including supply chain stability, growing demand for electric and autonomous vehicles, and global economic conditions, will influence automotive sales trends in 2025.
Gutierrez said there is a notable consumer preference for connected and personalized driving experiences alongside a shift to environment-friendly units.
He said vehicles featuring technological advancements such as AI, sensors, and infotainment systems have the potential to transform the industry over time.
“These factors will contribute to the overall positive sales trends in 2025,” he said.
NEVs: More electric dreams
Arraga said new energy vehicles (NEVs) give consumers certain options to shift to environment-friendly mobility, especially as the price gap between internal combustion engines and NEVs narrows due to tax incentives
NEVs are primarily powered by electricity, and hybrid ones combine gas and electricity in one engine. Hydrogen as a vehicle power source remains in the experimental testing stages
Gutierrez and Arraga agree that new eco-friendly models and reasonable prices will attract car buyers.
Gutierrez added that EV sales have been increasing; the first two months of the year attest to that.
He added that, based on Campi data, hybrid vehicles contribute more than 90 percent of total sales for this segment.
“With different types of pure EVs, from cars to e-trucks and e-bikes, being introduced in the market, this vehicle segment will certainly get a bigger market share soon. We are excited to see this development changing the landscape of the automotive industry in the Philippines,” Gutierrez said,
Campi/TMA data showed sales of four-wheel EVs in the year’s first two months stood at 3,416 units. There were no comparative figures for 2024, as the industry only started tracking EV sales in January.
Hybrid EVs accounted for 88.8 percent, selling 3,034 units, followed by battery EVs (BEVs), 33 units, and plug-in hybrids (PHEVs), 47 units.
Transitioning to EVs
Campi sees electric vehicle (EV) sales will comprise less than 5 percent of the total industry sales target.
According to Gutierrez, motorists have a strong tendency at this point to adopt EVs in passenger cars.
China’s Foton is the lone distributor of electric commercial vehicles in the Philippine market.
Arraga cited the Department of Trade and Industry, which said more and more automakers are launching electric cars, e-motorcycles, and electric public transport vehicles.
He said brands such as Nissan, Toyota, Mitsubishi, BYD, and Hyundai lead the EV market, while transport cooperatives are transitioning to electric jeepneys under the Public Utility Vehicle Modernization Program.
Toyota says that while electrification in the Philippines is still in its early stages, it welcomes the growing interest in electrified mobility options.
“For full BEV models, the lack of charging infrastructure and range anxiety is still a concern, not to mention affordability. The journey to electrified mobility is not a light switch moment; it will take time,” Toyota says.
Toyota, which pioneered the Philippines’ shift to gas-free cars like the Prius, is pursuing a multi-pathway approach, offering motorists a range of alternative and sustainable options in their journey to upgraded mobility.
For now, hybrids and PHEVs are the more popular and growing choice, according to Toyota.
The Department of Energy (DOE) defines BEVs as electric vehicles or electric vehicles that use a traction battery as a power source.
PHEVs are electric vehicles with rechargeable energy storage systems that can be charged from an external electric energy source. HEVs are electric vehicles with both a rechargeable energy storage system and a fueled power source for propulsion.
Prospects, challenges
With the sustained effects of expanded fiscal incentives for HEV and PHEV models, the advent of new market players, and continuous public-private collaboration on EV charging infrastructure, Toyota expects that EV sales volume will continue to increase.
According to Toyota, demand will be driven by strong competition in this automotive market segment.
For his part, Arraga said the approval of the Electric Vehicle Industry Development Act (EVIDA) and the rollout of the Comprehensive Roadmap for the Electric Vehicle Industry “made the difference in EV adoption as they helped build trust and confidence in the industry from a regulatory standpoint.”
These policies, he said, helped establish clear guidelines and standards that ensure EVs are not only safe but also equipped with the infrastructure needed to support daily mobility.
The EVIDA program provides a comprehensive regulatory framework for the development and growth of the EV industry. It establishes safety standards for electric vehicles and ensures that manufacturers adhere to strict guidelines that guarantee vehicle quality and performance.
On the other hand, CREVI focuses on developing charging infrastructure, which is equally crucial to making EVs available for daily use. With the assurance of reliable charging stations, drivers are more likely to embrace electric mobility.
For Toyota, making electrified vehicles more appealing in the Philippines faces challenges such as high upfront costs, limited charging infrastructure, and a need for greater consumer awareness about EV benefits and reliability.
These issues require a multifaceted approach involving government incentives, industry collaboration, and public education campaigns.
“At Toyota, we continuously expand our electrified vehicles line-up, including HEVs and BEVs. We want to provide customers with the choices that best fit their conditions,” it said.
Recharging outlets
As of 2024, AC Mobility, the mobility solutions arm of the Ayala Group, had the most charging ports in the country.
Jaime Alfonso Zobel de Ayala, AC Mobility’s chief executive officer, revealed at the recent launch of the ride-hailing service’s electrification program that the company aims to have 700 charging points in 300 locations by the end of 2025.
Zobel de Ayala said the company closed 2024 with 141 charging points in 16 locations, a notable increase from just 20 charging stations at the end of 2023.
There were a total of 847 charging stations last year, according to DOE data
China EVs’ invasion
Chinese brand BYD claims to have captured an 82 percent share of the new energy vehicles (NEV) market in 2024, but it did not provide the overall sales of all players.
BYD Philippines, under ACMobility and the official distributor of BYD passenger vehicles, sold 4,780 BYD units in 2024, an 8,900 percent increase from 53 units in 2023.
Of the total BYD sales, 2,078 units were full EVs, giving it a 69 percent market share and making it the leader in the domestic BEV segment.
The company said this performance placed BYD as the 11th best-selling automotive brand in the Philippines, with a 1 percent share of the domestic vehicle market. BYD is not a member of Campi.
Arraga said EVAP gives credit to Chinese brands for introducing innovative features and appealing prices for EVs.
He said Chinese brands, in fact, have an advantage as they dominate battery supplies in the market.
For Campi’s Gutierrez, entering the Philippines market with Chinese brands will certainly lead to “healthier competition” among brands.
“ China-made brands have undoubtedly been increasing their contribution to the total market. We have seen new players coming in over the years,” Gutierrez said.
On standards, Gutierrez said Campi ensures that the rules of fair competition apply to every player. “We encourage new industry players to join industry associations so that common concerns can be addressed. This also enables regulators and industry groups to develop relevant and consistent rules and regulations,” Gutierrez said.
