Honda Cars Philippines Inc. (HCPI) has announced that it will be stopping the production of its BR-V and City models in the country. This means that these models will now be sourced from out of the country. Along with the halt in production, the brand will also be shutting down its Sta. Rosa Laguna plant, it will take effect in March 2020.
The Japanese brand encountered difficulties last year despite ranking seventh in the top 10 car brands in the country. Honda Philippines was able to sell a total of 20,338 units last year and was able to get a 4.96% share of the local market. Even with great numbers, the brand still experienced a 12.69% loss in terms of growth in the previous year. With less than stellar sales numbers, it’s not hard to see why the brand would want to pull out of local production especially with newer more complicated units on the horizon.
The City being HCPI’s local volume seller vehicle, is already an old model. The new seventh-generation City was already launched in Thailand and comes with a host of new features and technologies. It comes with a new turbocharged engine as well as a hybrid powerplant. In order to make these units locally, it would require HCPI to retool its Sta. Rosa factory. This could be an expensive affair and a risky gamble for the brand if sales of the units do not return worthwhile investments.
Despite local assembly being shut down, a silver lining can be had from the situation. Thailand serves as the major production hub of Honda for the ASEAN region. HCPI already sources units from Thailand for the Philippine lineup, this means that the local market will have access to newer models quicker than before.