BOI greenlights Toyota, Mitsubishi entry in CARS

MANILA, Philippines – The Board of Investments (BOI) has given the green light to Toyota Motor Philippines Corp. (TMP) and Mitsubishi Motors Philippines Corp. (MMPC) to proceed with their investments that would help boost the country’s automotive manufacturing sector.

Trade Secretary Adrian Cristobal Jr. said the BOI has approved the applications of both TMP and MMPC to participate in the government’s Comprehensive Automotive Resurgence Strategy (CARS) program.

“Yes (it is already approved). It’s just a matter of formalities now. I understand that from the part of BOI managing head Ceferino Rodolfo, it’s just formalities now of granting the certificates of award to car manufactures that have qualified for the CARS program,” Cristobal said in an interview yesterday.

The awarding ceremony for both car makers is scheduled today.

MMPC has vowed to invest P4.3 billion to expand its assembly operations in the country as part of its CARS program participation.

The expansion of its Laguna assembly operations will allow the company to produce the hatchback and sedan units of its Mirage.

TMP, meanwhile, has yet to disclose its initial budget allocation for the program but has enrolled a new Vios model to qualify for the incentives.

TMP and MMPC are two of the largest automotive brands in the country in terms of sales.

Under the CARS program, prospective local car assemblers may apply for fiscal support not exceeding P27 billion by locally assembling three vehicle models, or P9 billion per model, with a commitment to produce 200,000 units for each model during its six-year model life.

The program seeks to boost local car assembly through incentives and allow industry players become more competitive in the region.
So far, however, only two of the three slots offered under the program are taken up.

Cristobal said BOI is currently studying what to do on the unclaimed third slot.

“I think that is being studied now. This program is ongoing and it will be now up to the incoming administration. According to the executive order, there is no restriction on a second round for the applicants,” he said.
Executive Order 182 or the CARS program was approved by President Aquino on May 29 last year.

With a CARS program seen to ramp up local production of vehicles, coupled with forecast domestic sales of 500,000 units, the Philippines is expected to become a major automotive market in Southeast Asia by 2020.