Gov’t eyes deferred CARS output target

govt eyes deferred cars output target - Gov’t eyes deferred CARS output target

By Jenina P. Ibañez, Reporter

THE GOVERNMENT may consider extending the compliance period for automotive companies participating in its incentives program developed to support local parts production.

The Board of Investments (BoI) is asking the automotive companies to submit proposals after an industry leader pointed out that they may not be able to meet the required production volume.

Toyota Motors Philippines Corp. and Mitsubishi Motors Philippines Corp. are participating in the Comprehensive Automotive Resurgence Strategy (CARS) program, which offers fiscal support to car companies that locally produce 200,000 units of high-volume car models for six years.

But Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) President Rommel R. Gutierrez, in an online press conference last week, asked the government to review the conditions for the program after the pandemic caused an industry sales slump.

In a press conference on Friday, BoI Managing Head Ceferino S. Rodolfo said that he understands the “difficult economic environment” the industry is experiencing.

“That’s why we are willing to take a look at their proposals. So kung meron silang (If they have) specific proposals on the volume requirement, on the timeline for compliance with the volume requirement, we are willing to take a look at it,” he said.

“But currently, the policy direction is that we are willing to take a look at a longer time period to comply with the volume requirement without adjusting the volume.”

He asked car companies to submit specific recommendations backed up by data on the units enrolled in the program and overall sales during the pandemic. The interagency committee on the CARS program will convene again, he said.

Vehicles enrolled in the CARS program include the Toyota Vios and the Mitsubishi Mirage, with deadlines set at 2024 and 2023, respectively.

CAMPI’s Mr. Gutierrez had said that the industry needs to collaborate with the government to maintain local production, saying that Vios and Mirage production have also been “badly hit” during the lockdown.

Cars sales saw a 48.7% decline in the first seven months to 105,583 units compared with the same period a year ago, a joint report by CAMPI and Truck Manufacturers Association said.

Year to date, commercial vehicle sales dropped 47.6% to 75,514 units, while passenger car sales fell 51.4% to 30,069 units.

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