Toyota Motor Philippines Corp. (TMP), the country’s leading automotive firm, expects electric vehicles (EVs) to more than double their share of total vehicle sales to 20 percent this year as consumers move away from fuel-based vehicles.

With fuel prices skyrocketing since the latest conflict in the Middle East broke out last month, TMP Chairman Alfred Ty said the company now expects EV sales to account for 20 percent of total sales, up from around 8.5 percent last year.

Last year, TMP sold a total of 19,516 EVs, covering both Toyota and Lexus models, nearly 39 percent higher than the 14,057 units sold in the previous year. TMP sold a total of 229,447 vehicles last year, based on industry data.

While sales of electrified vehicles were already expected to increase this year, the pace of growth in the first quarter has been faster than anticipated.

Ty said the company is now receiving significantly more advance orders for EV models compared to previous years, which it plans to support by bringing in more units to meet demand.

“Even before the war, there are plans for models to come in,” Ty told reporters on Tuesday, March 24, noting that the concern now is whether such deliveries would be disrupted.

“We haven’t seen how the war will disrupt logistics, but it will have an impact,” he added.

Under GT Capital Holdings Inc., which holds a 51-percent stake in TMP, Ty said the impact of surging fuel prices is prompting the conglomerate to reconsider its capital expenditures (capex) this year.

He hinted that the company may lower its capex as it prepares for higher operating costs, of which 20 to 30 percent is spent on energy and fuel.

“We haven’t finalized, of course, but everything’s on the table for discussion,” said Ty, who serves as vice chairman of GT Capital. “We start making our simulations, but you also don’t want to exaggerate it, so we have to take more time.”

Looking beyond the impact of the Middle East conflict, TMP is hoping that both Japan and the Philippines will begin negotiating potential amendments to the Japan-Philippines Economic Partnership Agreement (JPEPA).

The automotive firm has raised concerns over JPEPA, as vehicle imports from Japan, especially EVs, are subject to a 20-percent tariff rate under the agreement. This places Japanese vehicles at a disadvantage compared to those from countries where tariffs are much lower.

“We hope that both governments will start sitting down [on the amendments],” said Ty.