MANILA, Philippines - Toyota Motor Philippines Corp. (TMP) said yesterday that its parts and components exports are expected to increase by 21.43 percent to over $850 million this year.
TMP president Michinobu Sugata said that exports will go up to over $850 million by year end from only $700 million a year ago. As of the first half of this year, the company's parts and components exports amounted to $450 million.
“If measured in relation to completely built-up (CBU) export performance, Toyota Group exports in 2010 may already be equivalent to about 80,000 units of CBUs, a volume level which has never been reached under the Government’s Automotive Export Program,” Sugata said.
Although not currently engaged in the export of CBUs, Toyota’s contribution to exports has been significant through its export of parts and components to 11 production bases worldwide. This parts complementation scheme provides market opportunities for local parts manufacturers who may otherwise find difficulty in penetrating the export market individually.
Toyota said that the automotive industry’s current weakness is its limited parts supply base. With fewer manufactured parts available locally, vehicle manufacturers are compelled to import their production requirements, paying logistics, packing, handling charges, hence raising production costs. Given this scenario, the industry calls for adequate government support measures to encourage investments in parts manufacturing. Assemblers and auto parts makers specifically appeal for incentives to seize the strong potential of higher localization and consolidated parts export that would further spur growth and development of the auto parts supply base.
With recent pronouncements of the Department of Trade and Industry (DTI) indicating that CBU exports shall receive priority in the implementation of the Comprehensive Motor Vehicle Development Plan (CMVDP), Sugata said that, “it is also necessary to develop parallel measures for domestic-oriented firms considering that the industry has yet to fully develop its domestic base.”
Sugata is optimistic that the current market situation provides an opportunity to improve the industry’s local production performance.