What You Need To Know About CATS Motors and Inchcape’s Joint Venture

A new player is entering the Philippine automotive market, thanks to a joint venture with CATS Group of Companies—a local distributor of luxury vehicles. 

British automotive distributor Inchcape has announced its joint venture with family-owned luxury car distributor CATS Group of Companies—popularly known as CATS Motors. This 60% acquisition of the company marks Inchcape’s expansion into the Philippine market.

According to the company’s press release, the deal is expected to strengthen Inchcape’s “geographic reach and partnerships with Mercedes-Benz, Chrysler, Dodge, Jeep, Jaguar, and Land Rover, and broaden its relationships, adding RAM to its list of brand partners.”

“We are very pleased to be entering the Philippines, a country with a large and fast-growing economy, where CATS is the leading distributor of luxury vehicles,” says Inchcape APAC CEO Ruslan Kinebas in a statement.

“The Ang family has built long-standing successful relationships with its [original equipment manufacturer] OEM brand partners and its customers,” the statement adds. “We are looking forward to building on their achievements and accelerating the company’s digitalization journey, driving the business to further success.”

The transaction is expected to be completed in the second half of 2023. 

What This Means for the Ang Family and CATS Motors

Founded in 1989 by Felix Ang, CATS caters mostly to an upscale market as a go-to source of genuine car parts and services for luxury cars. With a legacy of over 30 years, CATS Motors has established itself as a reliable automotive industry in the Philippines.

“After over 30 successful years of operating independently, we believe the time is now right for CATS to take the next step in our growth journey, and in Inchcape, we have found the right partner to drive us forward,” Ang said.

Following the joint venture between the two companies—which is expected to be finalized in the second half of the year—the Ang family will retain the remaining 40% of the company and continue to be represented on the board by founder Felix Ang. Moreover, CATS is “expected to add £120 million [around PHP 8.1 billion] of annualized revenue” and will likewise be accretive to Inchcape’s operating margin. 

2022 Numbers for the Philippine Automotive Industry 

The arrival of Inchcape comes at a time of recovery for the country’s automotive industry. 

Like many industries, the local automotive industry took a hit during the height of the COVID-19 pandemic. And while the numbers from 2022 show that the industry has yet to return to pre-pandemic levels, it does show there is an improvement in the market. 

In fact, according to reports from the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and Truck Manufacturers Association (TMA), vehicle sales jumped by 32.4% or to 35,037 units in November 2022 in comparison to sales registered at 26,456 in the same month in 2021. On the other hand, automotive sales for 2022 as a whole reached 352,696.

In fact, reports add that the sales of commercial vehicles in November 2022 went up by 43%, while the sale of passenger vehicles went up by 8.8%—from the numbers sold in the same month in 2021.

Meanwhile, new players in the industry are very much welcome, given that the Philippines is a fast-growing market with an increasing demand for luxury vehicles. What’s more, local automotive sales are forecasted to grow to 500,000 by the year 2026 with the luxury market expected to grow at an even stronger rate.

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