Two steps in the right direction

As the local auto industry comes off another record-breaking year—with the promise of an even better one up ahead—a couple of very good laws have been either proposed or upheld this year that can do more for changing the local automotive landscape than a sudden downpour can do for an F1 race. 

The first is an existing Executive Order (EO156) that was upheld (for the second time) by the Supreme Court that declares the importation of used vehicles coming out of Port Irene as illegal. 

Funny, but after I had announced the news, however, complete with an official statement from LTO warning buyers to stay away from these B plate vehicles because they would not register them, I was later corrected by someone from Port Irene saying that I was being grossly irresponsible for reporting the ruling as final as they are still seeking yet another motion of reconsideration. 

I’m no lawyer, but as far as my basic knowledge of how the law works, a Supreme Court decision is usually considered final. The hierarchy is not like a pizza parlor that offer regular, family, supreme and super supreme. But good luck with that all the same. 

Which brings us to the next bill. 

What EO156 can do for the industry, the Hybrid, Electric and Other Alternative Fuels Incentive Act (SB2856), promises to do for the environment by basically exempting all Hybrid, Electric, LPG, CNG, Solar, Wind or other approved alternative-fuelled vehicles from taxes, duties and motor vehicle users charges, effectively rendering a Prius C to around the same price as a Corolla Altis. 

As it is now, a Prius C is about 1,490,000 pesos. Slash thirty percent off that, and we’re looking at almost 1 million flat. Not the most exciting car out there, I know, but you’ll have to admit that it is arguably the smartest. Besides, by exempting these types of cars from taxes, SB 2856 theoretically allows companies like Tesla to set up shop here and sell their awesome Tesla Model S for under 2.2 million. Ah, that woke you up, huh?

And that’s not even the best part. Because just about every manufacturer has a decent hybrid or EV program, this bill incentivizes them to bring in their electrifying line-up: Nissan has the Leaf, Honda has the Insight and CRZ, Chevrolet the Volt, Mitsubishi the i-Miev, Lexus have, well,  everything—heck, even BMW, Mercedes, Volvo and Porsche all have hybrids or plug-in EVs. Sure there are those that will lose out, but now is not the time to debate, but to innovate—seriously guys, you’ve had at least ten years notice. 

But considering how much ink I’ve spent on this topic recently, I’ll save you from my repetitive homily about what this will do for clean air and what will happen if we don’t get this passed into law before the 16th congress sits in June, and just dedicate the rest of this column to bringing up a few points I haven’t raised before.

First, if we go by Senator Zubiri’s statement, The Department of Finance is the only stumbling block that is keeping this worthwhile bill from being passed into law. “They (Dept. of Finance) will lose an estimated 1 billion in tax revenues, but they don’t see the potential of new industries that would be created because of this new law. New industries mean new jobs and more jobs for the people.”

A pretty obvious point. And one that I would be surprised that the Dept of Finance has not factored in; but even if they have, if anyone wants to boil this down to just money and put a price tag on our lives, perhaps they would like to take into account the monetary cost that pollution has on health care and productivity. 

“About 65 percent of drugs purchased by the health department every year were for treatment for respiratory diseases,” Environmental Secretary Ramon Paje has been quoted saying in several published interviews when discussing Metro Manila’s air pollution problem caused by vehicles. 

According to a World Bank study conducted back in 2008, filthy air costs the Philippines 2,000 lives lost prematurely plus US$1.5 billion in lost wages and medical treatment. And this doesn’t even take into account the reduction in tourism, loss of foreign investments, vegetation, quality of life and even damage to buildings and structures that require regular and expensive painting to keep them from looking like something that Lucifer’s lives in. 

So a billion pesos in lost revenue? That will barely cover the court costs. 

According to Babes Romualdez, in his Philippine STAR column, Spybits, entitled “Metro Manila’s deadly air,” “The Philippine Medical Association are preparing to file a P1-billion class action suit against the DOTC and Secretary Mar Roxas for the alleged failure in enforcing the Clean Air Act, with smoke-belching buses, trucks, jeepneys and other vehicles freely traversing the streets despite emission tests being mandatory prior to vehicle registration.”

But having said that, as fantastic as the bill is for the environment, I do see a few areas of concern. While I’m a 100-percent supportive of this bill, even going as far as setting up an online petition to get it passed into law, there are legitimate points that need to be addressed and provisions that should be inserted if we want to get the most out of it.

Firstly, the bill should be more emission-based than technology-based. While hybrids and EVs are a huge step in the right direction, this shouldn’t penalize small gasoline-powered cars that have similar or smaller carbon footprints. For example, a 1-liter Ecoboost Fiesta or Mitsubishi Mirage will use significantly less gas than a Cadillac Escalade hybrid, and should not be penalized simply because it chooses a different technology to arrive at the same destination.

I agree that hybrids and electric vehicles should be completely tax-free, but to be completely fair, provisions should also be set up in the bill for small-engined vehicles; the taxes should be based on carbon emissions and fuel consumption rather than the technology alone. 

Case in point, LPG. Yes there is a reduction in emissions, and they should enjoy some incentives, but this is only the case for properly fitted systems. I have seen some real hack jobs done on taxis and fleet cars that actually doubled the fuel consumption and increased emissions. The only way I can see an LPG vehicle enjoying tax breaks is if it were factory-installed from new, and still, it should not enjoy exactly the same perks as a zero emission vehicle like a Nissan Leaf or Mitsubishi i-MiEV.

And lastly, there should be a clear program developed, as early as now, for proper battery disposal and recycling. We don’t want to turn around in ten years once most of them start hitting their use-by date and appear shocked, no pun intended, when we see them being dumped in landfills. 

But however imperfect it may be, the bill is still a massive stride in the right direction and I appeal to our government to prioritize it before we miss that small window in June before the new congress sits. We’ve come this far, let’s not let the whole thing go up in smoke for the sake of revenue. There’s a much bigger picture, and all it takes are a few good men and women to put this to a bicam and then pass it in to law.

And then we can all breathe a lot easier. 

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