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Unfazed by Looming Vehicle Excise Tax Increase, Luxury Car Brands Jaguar and Land Rover Are Back in PH

The British car company returns to the country under Coventry Motors Corp. after a six-month break
By Paul John Caña |

Present at the signing were (from left) Gerry Alejandro, president of CMC; George T. Barcelon, chairman of CMC; Robin Colgan, managing director of Jaguar Land Rover Asia Pacific; Andy Wust, customer service director of Jaguar Land Rover Asia Pacific

 

 

Despite the looming increase in excise tax for vehicles, British luxury car brands Jaguar and Land Rover are back in the Philippines under a new importation and distribution company. Jaguar-Land Rover signed a partnership with Coventry Motors Corp. (CMC) assigning the latter as the official importer for both brands on Friday, November 24.

 

The announcement comes six months after the local Jaguar Land Rover dealership closed down and the company ended its partnership with luxury car distributor Wellington Soong, who also owns the Ferrari and Maserati dealership in Manila.

 

“We had a very good relationship with the previous distributor,” said Robin Colgan, managing director of Jaguar Land Rover Asia Pacific. “I would also like to thank very much the team and the organization there for the work that they’ve done over the years in working with Jaguar Land Rover.

 

“The truth is that we’re now at a next phase in terms of Jaguar Land Rover’s expansion, so our lineup has gone from literally a handful of models to now 12 products,” he added. “I can tell you without breaking any confidentiality agreements that the models that we currently market and that we will bring to the Philippines, that model range is going to expand quite dramatically into the future. And with it comes requirements for space, service capacity. The business has grown exponentially, in terms of scale.”

 

During a speech at the signing held at the Manila Polo Club in Forbes Park, Makati City, Colgan said the new partnership represents a new chapter in the history of the company in the country.

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“The Philippines’ robust growth of 6.9 percent in the last quarter—which has surpassed even that of China—is a clear indication that this is a market that holds remarkable promise and potential for quality premium cars that will meet the needs of a sophisticated and developed consumer base,” he said.

 

In an interview with Entrepreneur Philippines, Colgan also pointed to the country’s large population and an emerging middle class as factors for Jaguar Land Rover’s continued presence in the country.

 

“I think everybody’s forecast for the future in this market has been very positive,” he said. “(Despite the) large population, at this point, car ownership is still very low. The luxury car market as a percentage of the overall market is still very low and everything points to strong growth.”

 

 

 

In an interview with Top Gear Philippines, Marc Soong, executive director of Jaguar Land Rover Philippines and son of Wellington Soong, attributed the closure of the dealership to the excise tax issue. “With the coming excise tax, we have no leg to stand on as we do not know how things will play out,” he said.

 

Asked about the impending increase in vehicle excise taxes, Colgan said they were aware of the issue.

 

“It is a consideration, but the fact is that overall, (although) the taxes in the Philippines for luxury cars are high… I mean I look after 17 markets across the Asia Pacific region and many markets have high taxes. And even with this recent change, the Philippines won’t necessarily be the highest.

 

“So what we’ve learned, is that clearly, it restricts the market somewhat, but it doesn’t mean that the market goes away,” he added. “There’s still an interest and a demand. I think it probably means you have to work a little bit harder. And one of the ways in which you have to work a little bit harder is that there’s no point in coming to a market with a high tax structure as an also-ran. The pressure to really give people a reason to buy, I think, increases. And the way in which you give people a reason to buy is by giving them strong differentiation from everything else that’s on offer.”

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For CMC’s part, the increase in the vehicle excise tax was a consideration that did not stop them from pursuing the Jaguar Land Rover deal.

 

“All our future plans have already factored in the increase in excise taxes,” said Gerry Alejandro, president of CMC. “We are very honored and happy that Coventry has been appointed as the exclusive distributor and importer of Jaguar Land Rover, two of the most iconic brands ever. We look forward to working with them and to putting our efforts and resources behind successfully building the brands in the country.”

 

Another major business group that is entering the luxury car market despite the looming excise tax hike is diversified conglomerate San Miguel Corp. which put up an affiliate, SMC Asia Car, that will serve as official distributor and importer of BMW cars in the country last July. San Miguel will own 65 percent of the new company while 35 percent will be owned by Jose Alvarez, chairman of Asian Carmakers Corp., which also imports and distributes luxury vehicles.

 

Alejandro revealed that CMC will handle the introduction to the local market of two new products in the company’s lineup in the coming months—the Range Rover Velar and Jaguar-branded crossover SUV, the E-Pace. “While we will have the lines and products that the brand was built on, things like the XF and the XJ, and of course the full-size Range Rover and the Range Rover Sport, we’re really excited about the Range Rover Velar and excited about the Jaguar E-pace.”

 

Besides Colgan and Alejandro, also present at the contract signing were George T. Barcelon, chairman of CMC, and Andy Wust, customer service director of Jaguar Land Rover Asia Pacific. They were joined by CMC Directors Frankie Ang, Gerardo Domenico V.  Lanuza, Atty. Mike Toledo and Rene Nuñez.

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The first Jaguar Land Rover showroom under CMC will open during the first quarter of 2018 at the 1010 Building along EDSA in San Juan.

 

 

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Paul John Caña is the managing editor of Entrepreneur PH 

 

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