[MANILA] Ayala Corp, the Philippines’ oldest conglomerate, plans to invest US$150 million in car manufacturing, taking advantage of a global move towards green cars as it expands outside its core businesses of property and banking.
“We see a shift taking place in the automobile sector – the coming to an end of the combustion engine and the move to electronics as the main driver of cars,” said Ayala Corp chairman and chief executive officer Jaime Augusto Zobel de Ayala on Friday.
Several car dealerships and an electronic-manufacturing subsidiary that supplies half of its output to car manufacturers provide Ayala an avenue to “overweight the sector that’s going through massive disruption”, he said.
The Manila-based group is among the latest in Asia seeking to tap the burgeoning market for zero-emission vehicles as countries including China, the UK and France plan banning sales of fossil-fuel powered cars in a few years to battle pollution. Ayala acquired German car parts supplier MT Misslbeck Technologies this year, while a venture with European motorcycle-maker KTM AG has started manufacturing for China and South-east Asia, Mr Zobel said.
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Earlier this year, the company consolidated its assets in electronic manufacturing and vehicle dealership under unit AC Industrial Technology Holdings Inc.
Ayala, which this month sold US$400 million in bonds with a fixed-for-life annual coupon of 5.125 per cent to help fund investment, plans to participate in China’s Belt and Road initiative and partner Chinese counterparts in vying for infrastructure projects, Mr Zobel said.
Shares of Ayala rose 0.6 per cent to a record in Manila trading at the noon break, bucking the Philippine main index’s 0.3 per cent decline. The stock has risen 27 per cent this year.
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