THE HUNGRY ghosts came to roost. This year, the so-called “ghost month” fell from Aug. 23 through to Sept. 21; the Hungry Ghost Festival itself was on Sept. 6. This is a traditional Chinese occasion when ghosts and spirits — including those of deceased ancestors — are said to rise from the lower realm to visit family or seek victims among the living. To promote good luck and harmony during this period, some practices are observed, such as avoiding the start of construction, signing of contracts, undergoing major surgery, and the purchase of condos — or automobiles.
New vehicle sales reports for August seem to suggest that many car buyers may have had their “third eye” on the observance of the ghost month. In my many years in the automotive industry, this tradition has been a go-to reason by auto dealers and salespeople for low sales. In fact, it is already incorporated into the seasonality of the sales cycle.
The Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI), Truck Manufacturers Association (TMA), and the Association of Vehicle Importers and Distributors (AVID) reported total sales of 35,944 units in August. This is the second-lowest monthly sales turnover for 2025, higher only than April. This is 8.4% lower than sales in August last year, and represents a 6.6% decline compared to July 2025. This tells quite a tale. It did not help that the ghost month started on the last week of the month when car deliveries usually peak — accounting for 30% to 40% of the month’s sales. Buyers may have opted to push back deliveries to September to be on the safe side of tradition. On top of that, the two national holidays also resulted to a shorter sales month than usual.
If unofficial reports by non-member importers and distributors are considered, sales in August 2025 are at 37,444 units, which is a lesser drop of 6% versus the same month last year.
The ghost month’s effects notwithstanding, the biggest contributor to the sales slack in August 2025 versus the same month last year is the pickup segment. As will be recalled, the Capital Markets Efficiency Promotions Act (CMEPA) was signed by President Ferdinand Marcos, Jr. last June. Among the provisions in the law was the imposition of an excise tax on double-cab pickup trucks effective last July 1. This raised prices of some pickup variants by more than P200,000. The drop in sales was not immediately reflected in July due to carry-over inventories by some distributors, imported prior to the effectivity of the excise tax. The full impact was felt in August, thus the significant drop in total market sales.
As mentioned above, the total market dropped 6% versus August 2024 — if including sales of non-member auto distributors. Sales of pickup trucks, on the other hand, declined by almost 1,800 units or 34%. Only Isuzu did not experience a contraction in sales in August, presumably because it still has stocks that can be offered at pre-excise tax prices. If we add back the lost pickup sales, total August sales would have been almost at par (98%) with 2024. So there. The ghosts may have given us a scare, but the sales numbers do tell their own story.
Undoubtedly, growth percentages are starting to regularize this year versus last. In the first half of 2024, supply disruptions were still evident and new model launches were continuing to hit the market in quick succession. As we enter the second semester of 2025, growth rates will start to abate due to the higher sales base in the same period last year. This will become even more apparent in Q4 as the plug-in hybrid electric vehicle (PHEV) segment started recording volume sales last year. At the current pace, the market is on track to exceed 490,000 units. But with the usual strong sales takeup in the last quarter, breaking the 500,000 unit sales level is still very much in play.
On a year-to-date basis, total market sales of CAMPI, TMA, and AVID are reported at 306,378 units — just about even with the sum over the same period in 2024. Passenger-car sales dropped by 21.5% due to a fall in the small subcompact sedan market by 30%, primarily on the back of a decline in Vios sales. The supply of Vios was managed down by Toyota Motor Philippines (TMP) to give way to the production of the Tamaraw at its Santa Rosa factory. Making up the slack is a growth in the entry hatchback segment, which saw a growth of 13% led by the Suzuki Espresso (up 42%) and the Toyota Wigo (up 11%).
Meantime, sales of commercial vehicles were reported to have grown by 7.3%, mainly on the strength of the light commercial multi-purpose vehicle segment that includes the Toyota Tamaraw, Mitsubishi L300, Suzuki Carry, and Isuzu Travis. This segment reported a growth of 48% versus the same period last year. This growth is consistent with the sustained demand for versatile workhorse vehicles needed to drive economic activity, especially for use by micro, small, and medium enterprises (MSME) that comprise 99% of businesses in the Philippines. Though year-to-date pickup sales grew by 4%, this is due to pull forward demand and is expected to lag in the coming months.
If we include sales of non-member distributors, total auto sales are estimated at around 320,000 units, up 4% versus the same period last year. This is almost at pace with the gross domestic product (GDP) growth of 5%. Outside of the growth segments mentioned above, another driver is the electrified vehicle (xEV) segment whose sales breached 32,000 units as of August. This accounts for 10.1% of total vehicle sales compared to the whole of 2024 with annual sales of almost 25,000, accounting for 5.1% of the automotive market. Hybrid electric vehicle (HEV) sales are still preferred among the new electrified drivetrains, accounting for almost half of the xEV segment. PHEVs have grown significantly to 37% of the segment while battery electric vehicles (BEV) make up 15%.
Geo-political and geo-economic events continue to cast uncertainty on the economy. The impact of increased tariffs on exports to the USA are also expected to manifest more in the second semester of the year. Furthermore, fiscal and trade deficits continue to climb. Nonetheless, GDP is on a stable trajectory, inflation continues to abate, the Philippine peso remains reasonably strong, interest rates are lowering, and OFW remittances are holding ground. If things stay the course, auto sales should be able to sustain growth and, hopefully, shatter the 500,000 sales mark.
