RP must choose between producing and importing automobiles - AmCham

MANILA, Philippines - The Philippines must choose between producing vehicles in the country or importing vehicles before crafting any new regulation in order to better support the auto industry.

In an interview, John Forbes, American Chamber of Commerce in the Philippines (AmCham) legislative committee chairman, said that in order to make the Philippines an attractive automobile manufacturing hub, there must be certain policies especially when it concerns the importation of used vehicles.

“There will be no real progress in the industry unless the smuggling of vehicles is eliminated,” Forbes said adding that there are reports that imported used vehicles are still on sale in the country. “The Philippines can’t have both smuggling and car production.”

“The country has already missed the boat of opportunity in the industry because the government could never get the correct policy,” Forbes stressed.

For instance, he said that exports of locally produced vehicles are very small. He noted that the Philippines exports about 3,000 vehicles while the neighboring countries are able to export so much more.

He said that although a strong domestic market is necessary, it is not enough in order to attract big car makers to locate or expand their assembly plants here.

For his part, Benjamin Sevilla, executive director of the Philippine Automotive Competitiveness Council Inc. (PACCI) said that Ford Motor Philippines, the lone exporter of vehicles in the country, is willing to expand their capacity should the government decide to increase the incentives given to car manufacturers who will be exporting their vehicles.

Toyota Motor Philippines (TMP) has echoed the same sentiment in a separate interview saying that their planned expansion of their Laguna plant will be dependent on the incentive scheme given by the government. TMP is proposing a production based incentive.

“Given the right level of incentives, the members of PACCI are willing to expand their capacity,” Sevilla said.

This is the reason why the industry is welcoming the decision of the Board of Investments (BOI) to create a new Motor Vehicle Development Plan (MVDP) specifically for exporters. He said this will help industry players in their bid to ramp up local production.