Even with the threat of an influx of American cars into the local market, Security Bank Corporation believes its joint venture with Mitsubishi Motors Philippines Corporation (MMPC) can withstand the impacts of the zero tariff on United States (US)-made goods on the competitiveness of Japanese cars.

Security Bank Corporation President and CEO Sanjiv Vohra told reporters during the launch of Mitsubishi Motors Finance Corporation (MMFP), Inc. on Friday, Aug. 1, that the joint venture “will allow both partners to counter the impacts of tariffs, if any, through financing options as well.”

Vohra noted that around 70 percent of car purchases in the Philippines are financed through auto loans. This stresses the important role of financing in the local vehicle market. Taking off from this, Vohra noted that the customer is not just looking at the sale price, but also considering the monthly amortization or principal payments.

“So I think it gives us an opportunity, or at least gives the two partners an opportunity to provide the right financing mix if we need to counter some impact of the tariffs,” Vohra said.

“I think the joint venture will assist manufacturers like MMPC in their attempt to counter the tariffs in the market,” he further said.

After establishing the joint venture, the MMPC car financing previously handled internally by the Security Bank will transition to the joint venture. This shift involves a portion of the bank’s financing associated with MMPC moving to the joint venture.

Vohra said he anticipates continued growth on car financing, with non-MMPC financing remaining within the bank and MMPC financing handled by the joint venture.

“Auto loan has been a strong performer among the asset classes and consumer financing for us,” Vohrsa said, adding that while the first-half figure is still being crunched, he anticipates the autofinancing growth of around 52 percent in the first quarter to continue.

For his part, Satoshi Nakano, president and CEO of MMFP, reported that the firm’s market share in the local vehicle industry is 19.5 percent, which the company aims to expand to over 20 percent.

Takao Kato, president and CEO of Mitsubishi Motors, said the joint venture’s executives are expected to achieve more than 20 percent as a first step for the newly established company. “But of course, within five years, I’d like them to cover 25 percent or more,” Kato said

Vohra said Japanese car brands likely hold over 75 percent of the Philippine market, noting this dominance reflects strong consumer preference.

“I think our loan growth in 2024 was over 50 percent in terms of auto loans itself. However, through this joint venture, we expect the partnership to help us become a preferred financier for MMPC vehicles,” Vohra said.

He said the bank’s goal is to enable MMPC to “achieve their goals through providing innovative financing and flexible payment options, to be able to get the kind of market share that MMPC is aiming for.”