By Justine Irish D. Tabile, Reporter

HONDA MOTOR Co., Ltd. is seeking the extension of an executive order (EO) reducing tariffs and duties on all kinds of electric vehicles (EVs) beyond 2028, saying more time is needed to grow the market.

Toshio Kuwahara, Honda vice-president and head of Regional Operations in Asia and Oceania, did not propose a definite ending date for the EO’s effectivity.

“If the Philippine government will kindly consider extending this deadline, I think it will further be positive for the automotive industry to accelerate electrification,” Mr. Kuwahara said during the launch of the company’s EV lineup in the Philippines late Wednesday.

On June 20, President Ferdinand R. Marcos, Jr. signed EO 62, which modified the rates of import duty on various EV products.

The EO covered the expansion of the reduced Most Favored Nation tariff rates of the products covered under EO No. 12 to other battery EVs (BEVs), hybrid EVs (HEVs), plug-in HEVs (PHEVs), and certain parts and components.

Mr. Kuwahara said that the speed of the transition to EVs in the Philippines lags the progress made in other ASEAN countries like Thailand and Indonesia.

“In the Thai market, 23% of their passenger car sales are already BEVs,” he said.

He said the factors that make the Philippines a laggard include “the availability of charging stations, and the electricity cost itself.”

This year, the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) is projecting the share of EVs at below 10% of the industry sales.

Honda has a global target for EVs or fuel cell EVs to constitute 40% of total sales by 2030, rising to 80% by 2035 and 100% by 2040.

Louie C. Soriano, senior vice-president at Honda Cars Philippines, Inc. (HCPI), said Honda Philippines will have to align with the company’s global targets.

“I don’t think it will be the same (progress) for the Philippines … maybe a little bit later,” Mr. Soriano said on the sidelines of the event.

“We have to understand that we’re just importing. So we have to push it in the Philippine market. Because in the future, that (may be) the only automobile we can sell … so we have to adapt,” he added.

He said Honda is also planning a partnership that will lead to the installation of more charging stations in the Philippines, which aims to address the reluctance of consumers to switch to EVs.

“Of course, we’re also going to support the government’s direction towards electrification. That’s why we’re starting with hybrids, and in the future, we’re going to have the BEV,” he said.

“On charging stations, we are still in the process of discussing it … because how could we introduce BEV fully to the market if we don’t address these issues? So we are also going to do our part,” he added.

Regarding the duration of the proposed extension, Mr. Soriano gave no timeline but said: “The objective of this EO is to lower the cost in order for the cars to be accessible to the market.”

Meanwhile, Mr. Soriano said that Honda is still confident that sales this year will surpass last year’s result after the industry target was upwardly adjusted last month.

“If the industry increases its target, of course you have to also aim to have the same growth as the industry,” he said.

“We are going to surpass (our sales last year). We still have the “ber” months, the introduction of the new model, and of course the promotions, which are all going to help,” he added.

Last month, CAMPI raised its sales target to 500,000, from 468,300 initially. If realized, this will be the industry’s highest level of annual sales to date and will represent a 16.3% increase from 2023.

In the first eight months, Honda Philippines was 7^th in market share at 3.37%. Its sales declined 9.7% to 10,281 units in the eight months to August.

Last year, the company sold 16,645 units, accounting for 3.87% of industry sales.

On Wednesday, Honda introduced its new Honda Civic RS e:HEV which expands the company’s HEV lineup along with its first two-wheeler BEV EM1 e: and new battery-powered handled products.

Honda is targeting to add one dealership in Bacoor and end the year with a store network of 38.

It is targeting to start construction of three more dealerships in Paranaque, Talisay, Cebu, and Tacloban.

THE PHILIPPINES could emerge as a beneficiary of job cuts overseas due to artificial intelligence (AI), an industry group said, noting that outsourcing might actually accelerate hand-in-hand with the AI trend.

Most reports about job losses in relation to AI adoption are written from a foreign perspective, Dominic Vincent D. Ligot, head of AI and research at the IT and Business Process Association of the Philippines, told BusinessWorld on Thursday.

“On jobs, remember most reports about job losses are written from the perspective of Western countries like the US, UK, Canada, and Australia, which actually helps the outsourcing trend to countries like India and the Philippines,” Mr. Ligot, who founded Cirrolytix Research Services, said via Viber.

“We are usually the beneficiaries of these job losses abroad, and to maximize this, we should incorporate technologies like AI into our labor force skills to make the Philippines a more ideal destination for new work,” he added.

A report by the Institute for Management Development (IMD) World Competitiveness Center found that as AI systems become more adept at handling tasks performed by humans, such as data analysis and customer service, economies will experience job security disruptions.

“All in all, AI could drastically alter the workforce through its potential to replace it, a fact that raises important questions about the resulting social and economic effects and the repercussions on talent competitiveness,” said José Caballero, a senior economist at the IMD World Competitiveness Center.

“Additionally, incorporating AI into the workforce can introduce new forms of discrimination, such as biased algorithms, that may reinforce existing inequalities and have broader social impacts on marginalized communities,” he said.

He added that the increasing use of AI in hiring, promotions, and performance evaluations also raises concerns about fairness and accountability.

The report showed that 12% of the executives see AI is replacing existing tasks, leading to a reduction in the workforce, while 7% think AI is leading to employees quiet-quitting or opting for early retirement.

Citing International Labor Organization’s research, IMD said “that high-income economies are more likely to experience significant disruptions during the AI adoption phase than low-income economies, but they are also expected to obtain greater overall benefits.”

It said only 0.4% of jobs in low-income countries are at risk of AI-led automation, while the corresponding forecast is 5.5% in high-income countries.

It added that the concentration of AI-related job losses in female-dominated occupations could dampen the progress made in increasing women’s participation in the labor market.

Asked about the readiness of the Philippines to adopt AI, Mr. Caballero said that the Philippines is handicapped by a dearth of talent.

He said however that the percentage of graduates in sciences — ICT, engineering, math, and natural sciences — is improving, pointing to the easier adoption of AI in the future.

The report ranked the Philippines 52^nd in terms of readiness by assessing the quality of the skills in a country’s talent pool, out of 67 countries.

Mr. Ligot said that these rankings contradict other findings. 

“The recent World Bank report puts the Philippines in 4^th place in terms of AI traffic and corroborates reports by LinkedIn that say the Philippines is ahead of the global average in terms of AI adoption,” he said.

“The data is mixed, which suggests that despite the challenges, the Philippine workforce is very keen to adopt AI and that if the public and private sectors make the necessary investments, we can reap the potential of this new technology,” he added.

Jamil Paolo S. Francisco, executive director of the Asian Institute of Management Rizalino S. Navarro Policy Center for Competitiveness, said the country needs to improve the skills being developed in schools.

“The future workforce will need to learn how to work with advanced digital technologies,” Mr. Francisco said via e-mail.

“We haven’t even quite unlocked the full potential of the Fourth Industrial Revolution and digital automation, and now we are faced with some are calling the Fifth Industrial Revolution, that will require the workforce to collaborate with AI and machines,” he added.

He said that the way forward is to find out how people can do a better job while working with AI or robots.

“Being a largely service-sector-driven and labor-abundant economy, we need to invest in equipping our current workforce and preparing our future workforce for this type of human-machine collaboration to leverage the much-needed potential productivity gains,” he added. — Justine Irish D. Tabile