Hyundai bucks trade barrier in auto parts roadmap

SEOUL, South Korea – Vehicle importers in the Philippines are supporting the creation of a new roadmap for the automotive industry so long as it could not create trade barriers that would prevent them from bringing new models into the country.

The Department of Trade and Industry (DTI) is currently holding consultations with industry players on the creation of a new industry roadmap that aims to establish the Philippines as a major car manufacturing hub in the ASEAN region and to strengthen the local auto parts manufacturing sector.

“As an importer, we look at it from a global approach. So long as this roadmap will not cause unfair advantage to us, we will support it,” said Ma. Fe Perez-Agudo, president and CEO of Hyundai Asia Resources (HARI) and head of the Association of Vehicle Importers and Distributors (AVID).

“We believe in healthy competition. It engages all the industry players to be more innovative and create innovative products and services that would benefit the consumer. The consumer has the right to choose the car that he wants to drive, products should be available in the market at an affordable price,” she added.

The proposed roadmap aims to increase domestic production to 285,000 units by 2016, about 67 percent higher than the current production capacity of 170,000 units per year.

Of the 285,000 units, 195,000 units would be allotted for domestic sales and the balance for export. The roadmap also urges the industry to maintain the use of locally-sourced autoparts for 40 percent of the car body.

‘I’m sure whatever roadmap will be created will be more sustainable in the long-term,” said Agudo. Hyundai, which is currently the fastest- growing, if not yet the top-selling brand in the Philippines, is exploring ways to penetrate the luxury car market in the country, by introducing the Grandeur model, which is now plying the streets of Korea.

“We are now preparing for the introduction of luxury car models in the country,” said Agudo.

The luxury car segment in the country is currently dominated by BMW.

The trade department is also urging Hyundai Motor, through its parts manufacturing arm Hyundai Mobis, to source more parts components locally.

Hyundai Motor has repeatedly turned down the urging of the Philippine government to establish a production facility in the Philippines.

Because of this, the government is instead urging it to increase its parts imports. Agudo said Hyundai would conduct meetings with specific component suppliers in the country.