The practicality of buying a “slightly-used” car that allows consumers to keep some cash in their pocket without sacrificing quality, is driving sales of foreclosed vehicles, data from one of the country’s major banks showed.
According to Bank of the Philippine Islands’ unit Buenamano, a seller of foreclosed assets, sales of secondhand vehicles are climbing 20 percent annually over the past five years, highlighting consumers’ growing appetite, particularly among value-conscious buyers.
“The effect of excise taxes on vehicle costs have highlighted to consumers the merit of buying second-hand cars. As sellers of such assets, we lessen the gap between the need of the consumer and the affordability of that need,” said Fitzgerald Chee, head of Buenamano, which is under the Strategic Asset Management and Sales of BPI.
The rise in the secondhand car market is in sharp contrast to the decline in vehicles sales over the past five months due to the above-target inflation in June and the expanded excise tax under the Tax Reform for Acceleration and Inclusion or TRAIN law.
The Chamber of Automotive Manufacturers of the Philippines Inc. and Truck Manufacturers Association released its June data showing a double-digit drop in vehicles sales during the month to only 29,350 units from 37,479 units from a year ago. This was the fifth consecutive months that vehicle sales slumped. The six-month figure also showed a 12.5 percent drop to 171,352 units from 195,772 units in the same period last year.