MANILA, Philippines – Truck and bus assembler Hino Motors Philippines Corp., formerly Pilipinas Hino Inc., is ramping up its investments with Japanese investors now at the helm of the company.
Hino Motors Philippines chairman Vicente Mills Jr. said yesterday the company has earmarked P80 million this year, double the amount of what the firm used to spend annually in the past.
“We have set aside an initial capital expenditures of about P80 million to go to some plant expansion, some new equipment we’re installing, as well as some information technology and business process investments,” Mills said.
He said the higher spending this year is fueled by the company’s renewed confidence in the country’s growing economy and the potential of its commercial vehicle market.
“Philippine market for commercial vehicles has been in the past dominated by second-hand bus and truck imports. Considering the changes in economics, vehicle operators are now very conscious of fuel consumption, of downtime, of parts and components supply, and they are now more seriously considering and accepting price differences from second-hand to brand-new. They are now more seriously looking at vehicles that are reliable and that means brand new,” he said.
Hino Motors Philippines is mainly engaged in the assembly and distribution of quality Hino trucks and buses, distribution of genuine Hino spare parts, and supply of other automotive-related products.
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The firm recently changed its corporate name to Hino Motors Philippines following increased ownership of Japanese firms Hino Motors Ltd. and Marubeni Corp.
Hino Motors jacked up its ownership in the company to 70 percent from the previous 15 percent, while Marubeni’s stake went up to 20 percent from 15 percent.
Shares of local investors in the company, meanwhile, have been diluted to 10 percent from their previous 70 percent.
Hino Motors Philippines vice president Augusto Salcedo said Hino Motors and Marubeni saw the potential of the Philippine economy and the market for trucks and buses locally which is why they infused additional capital to increase investment for better facilities and bigger inventories.
“The infusion of capital from our foreign stockholders will ensure the continued expansion of the company with better and bigger facilities as well as more products and bigger inventories to match the expected further sales growth,” Salcedo said.
“We looked at the future and obviously there is a large investments required to really broaden our product line. To be able to respond to that market properly, we have to drastically increase our production capabilities and capacities. That means more investments,” Mills added.
Salcedo said Hino Motors Philippines at present is producing about 150 units of trucks and buses a month.
He said the firm is eyeing to grow this to at least 350 units per month over the next five years.
Likewise, the company is targeting to grow its dealerships nationwide to 20 in the next three years from its current network of 15.