There is a lot to be said about Hyundai's current situation in the Philippine market.

The local distributor, Hyundai Asia Resources Incorporated (HARI), really took the Hyundai automotive brand to new heights in the years past. In a market dominated largely by Japanese auto brands like Toyota and Mitsubishi, it was a remarkable achievement for Hyundai to rise up to third place overall.

But the sales figures are showing a rather unusual trend for this once very promising and very strong brand. In 2021, Hyundai sold just 9,061 units and ranked just eighth amongst other automakers and distributors in the Philippine market.

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We tracked their sales for the last 10 years based on our combined AVID and CAMPI sales reports from 2012 to 2021 and by far last year was their lowest ever in that decade. They reached a high of 37,678 units in 2017 even though they weren't really able to capitalize on the market uncertainty caused by an incoming tax law. The low point was in 2020 given the economic effects of the coronavirus, but while other automakers bounced back in 2021, Hyundai dropped even further by about 40%. That represents the largest drop by a volume brand in the Philippine market last year.

This runs contrary to how we've known Hyundai to be run in the country since HARI took over. Fe Perez-Agudo, the president and CEO of HARI, has a reputation as a fiercely competitive executive at the helm of Hyundai. At the start of her career at the top of Hyundai, she told us how one of Hyundai Motor's Korean executives tried to put her down: “You are a woman. What do you know about cars?”

Instead of backing down, she shot back: “You are a Korean. What do you know about the Philippines?”

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To us observers of the industry, seeing Hyundai in their current situation is not only strange but incredibly out of character. But it also gives credence to one of the Philippine auto industry's biggest rumors: the distributorship of Hyundai in the Philippines is about to change hands.

The new management will be supposedly led by Hyundai Motor Company. Yes, it's likely going to be a subsidiary or joint venture of HMC with another party.

While Hyundai Philippines officers will definitely not comment on the matter in an official capacity, there is a lot of unofficial talk that we've had with people close to the matter. That's mostly hearsay but it all does match up with a few indicators we've been spotting; signs that point to an imminent changing of the guard for one of the country's strongest brands.

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One of the most telling is the lack of activity on Hyundai's online portals. Hyundai used to be very active in social media, but now they're just uploading or sharing photos from customers and owners. But what's more unusual is that they haven't updated their price list online for the Philippines. It all still reads 2021 and it's already February 2022. All other automakers and distributors have updated their lists, but Hyundai hasn't.

Dealers are informing us that the supply of passenger vehicle units from Hyundai is drying up; from what we've been told, only a few Venue and Accent units remain. They don't appear to be importing any more units, which brings us to our next point: Hyundai isn't conducting any kind of major activities in the local market, particularly with regard to the Staria/Starex.

We have not had any word of the launch or even testing of the new generation Staria/Starex. Historically, this is a very important model for Hyundai. The Starex is the nameplate that made Hyundai's name in the Philippines so recognizable. Surely a company that is looking to grow their sales will move everything to bring their flagship model in as quickly as possible, and curb the sales of the model on the gray market. 

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Hyundai's partners in the dealership network have also been making some changes. We noted that quite a few dealerships have been divided up: one side is Hyundai, the other side is Changan. The local distributor of Hyundai has also become the new Philippine distributor of Chinese automaker Changan, and it makes sense for them to maximize the potential of their dealer network by offering more models from Changan as they make preparations to switch.

Sources do tell us that the switch to the new Hyundai Motor Company-led distributor is going to happen soon. According to some insiders it was supposedly planned for January 2022, but the situation with the pandemic made it impossible or so we've been told.

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The prospect of Hyundai Motor Company coming in as Hyundai Philippines is most definitely an interesting development, and there's history to back that up. The last time the "mothership" took over the importation and distribution of a brand here was Nissan in 2013. Prior to then, there were the "two Nissans" with UMC handling the commercial vehicle side (e.g. Patrol, Frontier Navara) and NMPI handling the passenger car side (e.g. Almera, Sentra). Then Nissan Motor came in and established Nissan Philippines, Inc. as the national sales company and they took the brand to where it is today.

If Hyundai Motor coming in can push for that strategy, they can recover the ground lost or even grow further. They will need to reassure customers that warranties will be honored and service will continue as usual. And of course, we wouldn't mind if they sped up the introduction of new models in the Philippine market. We won't be surprised if Hyundai -if that is indeed the case- will go full blast with a big launch with multiple models.

But it's definitely not the end for HARI: we have been informed that the likely scenario is that they retain the Hyundai Truck & Bus business. Given that there has been more activity (e.g. press releases, etc.) on the commercial vehicle side from HARI, we can see that as a very logical move. Their year-on-year growth for commercial vehicle sales was a very handsome 206.89% and it will be quite profitable for HARI moving forward. 

The writing on the wall points to big changes happening at the house that HARI built. If you're about to move out of a place you've been renting, would you bother to clean and repaint it for the next guy?