Global Market Research Reports : Ken Research: Philippines Used Automobiles Sector

Thursday, April 13, 2023

Internet Penetration Sets the Path for Used Car Sales to Cross More Than 450,000 Units by the Year 2026: Ken Research

The Philippines Used Car Market is Expected to Grow at A CAGR Of 7.6% In the Next Five Years in Terms of Used Car Units Sold by the Year 2026, as per findings released by Ken Research.

1. 75 Mn Active Social Media Users: Social Media Spurring Demand for Pre-Owned Cars in Unorganized Market.

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Among the country’s population of more than 105 million as of January 2020, there are almost 75 million internet and active social media users. This accounts for 67% of the total population. The online social media websites and chat windows in Philippines are the main growth driver of the unorganized sale of pre-owned vehicles in the country. The reason being that the vehicles can be listed on the personal web pages of the individual car seller which is 100% free of charge. On the other hand, they can approach a freelancer/ multi brand dealer having a Facebook page in the name of their dealership. These free lancers can also list the vehicle for a negligible price point on behalf of the Individual seller. The unorganized market is very big and has thousands of buyers and sellers who are willing to buy used cars due to price differentiation. The example of social media in the country are-Facebook, Car Finder and WhatsApp Chat.

2. The Market Share of Online Channel in Organized Market is Expected to Grow at a 5 Year 8.0% CAGR From More Than 80% Of the Market Share In 2021P to Nearly 91.5% by 2026.
Online sales channel is expected to grow with significant rate over the forecast period

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The online sales channel has gained traction owing to its wide reach and lower advertisement costs. Moreover, the organized players have realized that the first point of contact for the any used car buyer nowadays is the online classified pages, used car portals and other social media pages Technology advancements have changed consumer positions in the market, including the emergence of the internet, the usage of e-commerce sites and applications to increase company demand, and the introduction of hybrid and electric automobiles. Thanks to web technology, consumers are learning more about the car, its residual value, third-party profit margin, and other aspects.

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Philippines Used Car Market

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Wednesday, April 12, 2023

The Number of Used Car Sales Is All Set to Cross More Than 450,000 Units By The Year 2026: Ken Research

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The Philippines Used Car Market Is Expected to Grow at A CAGR Of 7.6% In the Next Five Years in Terms of Used Car Units Sold by the Year 2026, as per findings released by Ken Research.

Improved infrastructure, Train tax, and young population are listed as the key “pull” factors for the growth in the Philippines Used Car Market. This market is expected to witness a growth of 7.6% in next 5 years.

1. “Mega Manila Subway”: Government to Invest More Than 4 Bn Dollars in The First Subway Project.

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The Government of Philippines has been working towards improving the infrastructure of the country. President Duterte’s ‘Build! Build! Build!’ program is aimed at ushering the ‘Golden Age of Infrastructure’ in the Philippines. These initiatives will improve the road and the traffic conditions of the country making owning a car a more convenient option for the people of Philippines.

2. Philippines Number of Registered Vehicles was reported 5,000,000 Unit in Dec 2021: An Increase from the previous number of 4,000,000 Unit in Dec 2020.

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As of 2021, around 64.7% of the Filipino population is in the age bracket of 15 and 64 years old. This states that a huge chunk of the population consists of Millennials, who don’t have the financial stability to afford a new vehicle; hence they resort to the pre-owned units in order to meet their requirement of a dream car. In 2018, 25% of Filipino households in the Philippines owned a motorcycle or a tricycle. Furthermore, approximately 6% of households owned a car, jeep or van, while only 4% owned a motorized Banca or boat.

3. The Tax Reform for Acceleration and Inclusion (TRAIN) Law in Philippines, Proving to Be a Major Driving for Used Car Market to Reach around 460 thousand Units Sales by 2026.

Republic Act 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) law came into existence from 1st January, 2018. The reform in taxation got a merit for the used car industry of Philippines because the new vehicle units have become relatively expensive. Since all the new car buyers now would have to pay steep taxes, the buying behavior is switching from new cars to pre-owned cars which are available at much cheaper price and the buyer is not supposed to pay less tax or at times no tax on the purchase. This step was taken by the current government in power to reduce the vehicle traffic on roads and encourage people to use second-hand or pre-owned cars and reduce demand for imported cars.