The Philippines should make its car production industry more competitive to avoid losing out to its Southeast Asian neighbours according to Bosch.

Roland Odenthal, managing director of Robert Bosch, Inc. (Philippines), said there are no indications yet of putting up a manufacturing facility here, noting that the country lags behind Thailand and Malaysia in car manufacturing.

"Bosch is heavily investing where our customers are... particularly where there's a strong automotive industry. Unfortunately, there's not too much car production in the Philippines," he told reporters in Manila.

Thailand, Mr. Odenthal said, manufactures about 1.5 million vehicles a year, while Malaysia makes close to 500,000 cars compared with about 100,000 in the Philippines.

Bosch, however, is expecting 20% growth in Philippine sales this year, driven by a strong regional economy and high demand for power tools and automotive products, Mr. Odenthal said. The local subsidiary posted 20% growth last year.

"We are quite happy with the turnover here. We're already strong in the Philippine market, but the market is not that big," he said.

The Philippines vehicle market expanded by 12.5% year-on-year in May to 10,900 units, according to data released by the Chamber of Automotive Manufacturers of the Philippines (CAMPI).