Under that certificate of authority, NARC and its foreign partner, Daimler-Chrysler Corp., have been allowed to import 7,000 SKDs over a three-year period.
NARC and Daimler-Chrysler reportedly need three years to test the market for the best possible model which they would then produce locally.
NARC president Luis Quisumbing said that Filipino consumer preference has shifted to Asian utility vehicles (AUVs) and sports utility vehicles (SUV) partly due to the price.
"Government’s imposition of an excise tax on so-called luxury SUVs, specifically the 4 x4 models, has resulted in a significant drop in demand for those vehicles," Quisumbing said.
Even demand for passenger cars, Quisumbing said, has been adversely affected. "Consumer preference has instead shifted to the tax-exempt AUVs," he said
Under NARC’s certificate of authority, the firm would initially bring in 1,000 SKD units, with an option to bring in another 2,500 units in 2002 and 3,500 units in 2003.
The government, however, had imposed some conditions on NARCs importation of SKDs. These include requiring NARC to go into full automotive assembly of completely knocked down (CKD) packs within 18 months and putting up a guarantee for its committed net foreign exchange earnings.