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Thursday, July 10, 2008
High gas prices fuel demand for small cars
CAGAYAN DE ORO -- The "Fast and the Furious" and other classic car movies just wouldn't be the same at today's gas prices.
Fuel-efficient conscious buyers are rewriting the plots.
Arroyo Watch: Sun.Star blog on President Arroyo
Buyers now say small cars are beautiful and fuel-efficiency, rather than style and brand, is fast becoming the deciding factor when one buys a vehicle.
This is what photojournalist Bobby Timonera had in mind when he shopped for a second car for his wife and family.
"The SUV that we had is a gas guzzler. We need a smaller car which is very fuel efficient in city driving," he said.
Timonera plans to buy a Nissan March, a reconditioned car with engine displacement of 1386 cc, from one of the auto dealers in Cagayan de Oro City.
He said the Nissan, which could run 16 kilometers for a liter of gasoline, would be economical for his wife, a doctor, who had to make daily rounds to her patients in Iligan City.
"The SUV runs on seven kilometers per liter. Imagine how much we can save with that small car," Timonera said.
Timonera said small cars, aside from being fuel-efficient, are also easy to maintain and park in crowded city streets.
"People in big metro cities of Sydney, Hong Kong, and Singapore prefer small cars because it is easy to find parking spaces for them. We have the same parking space problem here," he said.
As fuel prices hit historic highs, car companies are introducing new models or "minis" in the markets.
There are the Nissan March, Nissan Starlet, Chery, Chery Tiggo, Chery Couin, Kia Picanto, Suzuki Swift, Hyundai Getz, Toyota Yaris, and the Honda Jazz.
"If you know your needs and is concerned about cost effectiveness of your fuel then go for a small car," Ricardo Gabaon, manager of Chery Cagayan de Oro, said.
"With the high cost of gasoline small cars like Chery become the alternative," he added.
Gabaon said the small Chery--priced from P366,000 to P699,000--can go 20 kilometers per liter of gasoline compared to the SUVs and medium-sized cars that run only nine to ten kilometers per liter.
"It is fast despite the low engine displacement and very economical," he said.
Gabaon said Cagayan de Oro buyers are slowly coming to accept China-made cars, meaning people are now looking for fuel-efficient vehicles regardless of brands.
Although Gabaon did not say how many units they have sold so far, car industry records say that the Cherys have sold around 1,000 nationwide from January-June this year, from the 180-200 in unit sales it had from July-December 2007.
"Especially now with gas prices going up every week, P1.50 to sometimes P2 per liter, if I'm the car buyer, I'll have second thoughts bringing a car, especially if the car runs only about six kilometers to seven kilometers per liter," Gabaon said.
"I need to buy something practical," he said.
Gabaon said the Chery has all the features--ABS, DVD, safety, style, and durability-- found in medium-sized cars that sells for P1 million.
Times are indeed changing and even reconditioned cars like Nissan March and Starlet are gaining popularity.
Jofry Sarado, manager of Norkis Northern Mindanao branch, said they average 13 units sold a month depending on whether they offer discounted prices or "promo sales."
Sarado said they are targeting "practical buyers" like doctors, medicine salespersons, and other professionals.
"These are our usual clients because their work involves going around the city only," Sarador said.
He said their buyers usually have a monthly income of P25,000 and are part of the middle class. They usually have a gasoline budget of between P2,000 to P3,000 a month.
Nissan March is priced P275,000 while the Toyota Starlet is priced P305,000.
Although these cars are surplus from Japan, Sarador said all their units are 100 percent reconditioned in their Cebu City Norkis production plant.
It used to be that the top consideration for car buyers is to determine whether the car is suitable for the country's generally poor road conditions.
Times, however, are changing.
Second-hand dealers in Barangay Bulua are experiencing a slump in their sales of Mitsubishi Pajeros, Toyota Revos, Toyota Corolla, Toyota Land Cruiser, Nissan Sentra, Nissan Pathfinder, Nissan Escape, Isuzu Fuego, Isuzu Hilander, Isuzu Dmax, Isuzu Trooper, Isuzu Crosswind, Isuzu Forward, and Ford Rangers.
Raul Roldan said their sales went down by 60 percent compared to the last quarter of 2007.
He attributed this to the enrollment period when parents have to pay up for the tuition of their children.
"Wala kaayo mi halin karong panahona tungod kay enrollment man gud, didto ma-prioritize sa tuition," Roldan said. (Parents prioritize and use their money for tuition.)
As oil prices hit $138 per barrel this week, the market for compact and sub-compact cars will be here to stay. (Annabelle L. Ricalde and Mark D. Francisco/Sunnex)
For more Philippine news, visit Sun.Star Iloilo. (July 10, 2008 issue)
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