이 기사는 2021년 11월 18일 08:01 thebell 에 표출된 기사입니다.

Hyundai Motor’s Philippines operations have transitioned from a distributor model to a direct sales model in a move to boost the company’s price competitiveness and marketing ability in the market dominated by Japanese automakers.

The South Korean automaker established Hyundai Motor Philippines Inc in the third quarter of this year. The newly created entity, 99.99% owned by Hyundai Motor, will directly sell Hyundai’s cars and auto parts to customers there.

Previously, Filipino customers would buy Hyundai’s vehicles only through Hyundai Asia Resources Inc, the sole dealership for Hyundai Motor in the country. The partnership between the two companies began in 2015.

The Filipino auto market, like other Southeast Asian countries, is dominated by Japanese brands. Toyota, Mitsubishi, Nissan and Suzuki together held a share of over 70% in 2019, according to data from the Korea Trade-Investment Promotion Agency. Especially, Toyota claimed a 38.7% share, compared to Hyundai’s 8.1%.

There was little change in the market share dynamics in 2020 when Filipino car sales declined by about 40% due to the effect of the Covid-19 pandemic, with seven of the top 10 places in the sales ranking being Toyota models.

Hyundai’s vehicles are less popular in the country, largely because of their high price tags to reflect heavy tariffs imposed on car imports. Hyundai’s models are said to be 1.2-1.5 times more expensive than similar Toyota models.

“Many Filipino consumers are interested in buying Hyundai and Kia models, but their prices are less competitive than those of Toyota vehicles, which are manufactured locally,” an industry insider said.

Hyundai’s new retail format, which has been simplified by removing wholesale from the sales process, is expected to enhance its price competitiveness. A free trade agreement between South Korea and the Philippines, which was signed last month, is also likely to give the South Korean automaker more pricing flexibility.

Moreover, Hyundai’s Indonesian plant is set to be operational in early 2022, which will help reduce the delivery lead time for Filipino customers.

“With a shift to a direct sales model, we will be able to respond to customers in a more organized manner,” an official at Hyundai Motor said. “This will help enhance our competitiveness not only in terms of pricing but also customer services.” (Reporting by Doung Yang)