The continued growth in automotive sales is driven by the country’s favorable economic demographics, an analyst said on Monday.

A joint report by the Chamber of Automotive Manufacturers of the Philippines, Inc. and the Truck Manufacturers Association noted an increase of 6.8 percent in year-to-date (YTD) vehicle sales, reaching 117,074 units as of the end of March 2025, compared to 109,606 units sold during the same period last year.

The share of electrified vehicles (xEV) in YTD sales is 5.73 percent, accounting for 5,311 units, with hybrid electric vehicles (HEVs) comprising 4.90 percent or 4,544 of total xEVs.

The report said commercial vehicles captured the largest share of sales with 92,742 units, followed by light commercial vehicles with 69,508 units, and passenger cars with 24,332 units sold.

Toyota Motor Philippines Corporation remains the dominant market player with a 47.42 percent market share at 55,541 units, followed by Mitsubishi Motors Philippines Corporation with 19.97 percent at 23,382, Nissan Philippines, Inc. with 5.74 percent at 6,722, and Suzuki Philippines, Inc. with 4.65 percent at 5,441 units sold.

With this, Rizal Commercial Banking Corporation chief economist Michael Ricafort said the continued growth in vehicle sales could be attributed to the country's favorable demographics and may also reflect the country's improved economic fundamentals, as the Philippines is one of the fastest-growing economies in the ASEAN region and Asia, and has consistently had the fastest-growing vehicle sales and production in ASEAN in recent months or years.

“The country's demographic sweet spot/dividend or a majority of the more than 113 million total population, the 12th largest in the world with a relatively young age of below 25 years old, already at working age since 2015, or more than 50 million Filipinos, increased incomes and spending power for more Filipinos, thereby allowing more of them to purchase vehicles, homes, consumer goods, and other products; one of the last major ASEAN/Asian countries to enter demographic sweet spot/dividend, thereby leading to GDP growth that is considered among the fastest in the region,” Ricafort said in a Viber message.

Further, he said other factors that contributed to relatively faster vehicle sales growth compared to gross domestic product growth include local employment data that is still among the best in nearly 20 years—or since revised records started in 2005—and already in line with other more developed Asian/ASEAN countries, with recent unemployment levels low at 3 to 4 percent in recent months.

However, the continued lack of a mass transport system in most parts of the country has also increased the need for more Filipinos to purchase vehicles, with more brands and models to choose from amid increased competition from Asian and global automakers.

“Another source of growth is the Philippines has yet to catch up with other countries in increasing the demand for electric vehicles (EVs) and hybrid vehicles, given increased competition in terms of lower prices from China, Vietnam, and other countries,” he said.

Moreover, he said newer models, more brands, low down payment and more affordable vehicle purchase schemes, more EV and hybrid vehicle sales, self-driving and more technologically advanced vehicles, modernization of the transport fleet, favorable demographics, and improving employment data in recent months are also still driving demand and sales of vehicles.

“The continued growth in vehicle sales is also consistent and supported by the double-digit growth in consumer loans, particularly auto loans, despite and defying relatively higher interest rates that have increased borrowing/financing costs since 2022. For the coming months, lower Fed and local policy rates could increase demand for auto loans and also vehicle purchases. Furthermore, the Philippines is the 10th largest globally in terms of vehicle sales for the world’s largest automaker,” he explained.