BOI ratifies Ford deal with Thai firm

The Board of Investments (BOI) has ratified its approval of Ford Motor Co. Phils. Inc.’s (FMPI) ASEAN Industrial Cooperation (AICO) arrangement with Auto Alliance Thailand (AAT) covering the exchange of locally assembled completely built-up (CBU) Ford and Mazda vehicles.

The AICO scheme is an ASEAN industrial cooperation program that promotes joint manufacturing activities between ASEAN-based companies.

The BOI approved FMPI’s application to avail itself of the AICO scheme on Aug. 28 this year and subsequently ratified its approval during its mancom meeting on Sept.9.

The BOI approved FMPI’s AICO application noting the incremental investment in facilities and equipment amounting to P259 million and generation of 120 new jobs.

Under the swap deal between FMPI and AAT, the exchange of CBUs would involve the C206 Laser/J39 Protege passenger car, U204 Escape/J14 Tribute SUV from FMPI.

AAT, on the other hand, would ship in CBU J97 Ranger pick-up trucks and parts and components for U204 Escape/j14 Tribute SUV, and C206 Laser/J39 Protege car.

Ford’s arrangement is the first AICO application in the country involving CBU vehicles.

FMPI and AAT’s move was arrived at pursuant to the agreement reached during the 29th ASEAN Working Group Industrial Cooperation (WGIC) meeting in Jakarta, where it was agreed to allow companies to submit AICO applications involving CBUs.

The BOI said an AICO application involving CBUs is critical to the future success of the implementation of the ASEAN Free Trade Agreement (AFTA) and can serve as a catalyst for industries in each economy to support the full implementation of AFTA.

The BOI said the Motor Vehicle Parts Manufacturers Association of the Philippines Inc. has expressed its full support of Ford’s AICO arrangement since it offers expansion in export market for local automotive parts and components, acquisition of additional replacement parts, expansion of domestic original equipment manufacturers (OEM) markets, availability of more motor vehicle models for consumers and broadening the base of local parts and components industry.