Mitsubishi to Inaugurate New Philippines Plant Amidst Record Market

Mitsubishi will formally inaugurate a much larger facility in the Philippines Jan. 29, as vehicle sales in the country hit a record volume in 2014 and are predicted to grow again this year.

The new plant, formerly a Ford facility and in Sta. Rosa, Laguna will open with a 50,000-unit annual capacity, and Mitsubishi Philippines Marketing Vice President Froilan Dytianquin tells the Manila Times it can be upgraded to 100,000.

The new, 52-acre (21-hectare) plant replaces Mitsubishi’s original Cainta plant, which opened in 1964 and closed last month. In 50 years, it rolled out 581,671 units.

Mitsubishi Philippines President and CEO Hikosaburo Shibata says the opening of the new plant comes as the Philippines is entering a stage of rapid motorization, given the continuous growth and successive industry record-breaking sales.

“MMPC now is in a position to further enhance its production capacity (and) at the same time support the expected increase in market demand in the coming years with its new assembly plant,” Shibata says in a statement.

The opening of the new factory, he tells reporters, will further strengthen Mitsubishi’s assembly operations, utilizing heavy stamping machines, advanced equipment and facilities engineering.

Mitsubishi’s Philippines sales grew 16% last year to 50,085 units for the automaker’s 8^th consecutive year of sales growth. It was the first time Mitsubishi sales topped the 50,000-unit mark in the country.

Shibata says he’s aiming to make it nine years of growth.

“With the auto industry demand for 2015 projected at 310,000 units, MMPC’s sales objective is to sell 62,000 units, or 23% higher than last year’s volume, and to keep at least 20% market share,” he tells the Manila Times.

Mitsubishi’s expansion comes as the industry saw 30% growth last year to a record 234,747 units.

The Chamber of Automotive Manufacturers of the Philippines (CAMPI) and the Truck Manufacturers Association says the performance was backed by robust sales in all product categories.

The passenger car segment soared 48% to 90,287 units. CAMPI President Rommel Gutierrez credits the introduction of several new models and a wider acceptance of the small-car category.

The commercial vehicle segment rose 20% to 144,460 units, with the light CV segment up 26% to 93,589 units.

Toyota led the market with a 45% share, ahead of Mitsubishi on 21%. Ford moved into 3^rd with an 8.7% share.

CAMPI and TMA are not as optimistic as Shibata, predicting sales this year will grow 16% to 272,000. They cite the expected continued improvement of the economy, increased government spending in preparation for next year’s national election, and the positive impact of the decline in world fuel prices.

But Gutierrez says he wouldn’t be surprised if the 2015 sales easily exceed 300,000 units, noting the challenge is for the local assembly sector to maintain or perhaps increase its share of this growing market, and the industry is waiting for an announcement of a package from the government to make it happen.

Last year, locally assembled vehicles accounted for only 37% of the market.

The Association of Vehicle Importers and Distributors (AVID) says its members’ sales grew 13% in 2014 to 35,565 units, driven by a 14% increase in passenger-car sales and a 12% hike in LCV sales.

“The upbeat performance of the LCV front was brought about by the 79% double-digit growth of Chevrolet from 3,877 units in 2013 to 6,952 units in 2014,” AVID says in a statement.

AVID also expects the Philippine auto industry to grow in 2015, crediting a “sound business environment and strong consumer sentiments.”