Hyundai upbeat on sales growth

MANILA, Philippines - Hyundai Asia Resources, Inc. (HARI), the official distributor of Hyundai vehicles in the country, expects to move past its two-year modest sales growth next year behind gains under the Asean-Korea Free Trade Agreement (AKFTA) and introduction of new models.

In an interview Thursday night, HARI president and chief executive officer Ma. Fe Perez-Agudo said the company is targeting a double-digit sales growth next year, a big improvement from this year’s expected flat growth and 2014’s four percent growth.

“We have resolved the issues of supply shortage and we’re ready to roll out across all models. Expect that we will have a great 2016 because of the Elantra, because of AKFTA, and because of the Euro 4 so our products will be more competitive. Definitely 2016 will give us more chances of really improving our ranking in the industry,” Agudo said.

As of end-October, HARI’s sales slowed six percent to 16,703 units from the 17,693 units sold in the 10-month period in 2014.

Agudo said one of the major drivers of growth next year is the implementation of the tariff reduction for vehicles imported from Korea to five percent from its current 20 percent.

The upcoming implementation under the AKFTA gives HARI a tariff advantage over Japanese car importers in the country.

Agudo said there already has been a realignment of pricing across Hyundai vehicles in the past three months resulting to a price reduction ranging between P20,000 to P80,000 per unit depending on the model.

“There will be value added enhancements that we included in all our vehicles because we are able to take advantage of the savings that we generated from this AKFTA. This will be announced by January,” Agudo said.

“We have been quietly adjusting the process for buyers as early as October because we don’t want the customers to feel they were shortchanged buying it in the last quarter, and then suddenly a new price will come in. So buyers in the last three months enjoyed it ahead. We started rolling out already the reduction program but we didn’t take make an official announcement yet because we did not want to be ahead of the competition. We were quietly doing it already in all our dealerships,” she added.

Agudo said tariff for vehicles imported from Korea could be reduced to as lows as zero percent, but that would depend on discussions between the Philippine and Korean governments.

Aside from gains under the AKFTA, Agudo said new and existing models would also help boost HARI’s growth next year.

Among the models that would drive higher growth are the Starex, Tucson, Accent, and the new Elantra.

Agudo said HARI would start next year with eight models and end it by 12 with the addition of the Elantra, Genesis, i40, and another compact SUV.

Agudo said HARI remains open to the possibility of putting up a local manufacturing and assembling plant.

“We won’t close our doors. We will continue to explore opportunities and we will continue to open the discussions with Hyundai as they also continue to grow and expand outside Korea. If there is an opportunity, or a chance, then definitely the Philippines will always be the center because we are their second biggest market after China,” she said.