April 21, 2021

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CARS program could be extended by three years

2 min read

THE GOVERNMENT is considering a three-year extension to the compliance period for automotive companies participating in its incentives program, which was developed to support domestic parts production.

Toyota Motors Philippines Corp. and Mitsubishi Motors Philippines Corp. are participating in the Comprehensive Automotive Resurgence Strategy (CARS) program, which offers fiscal support to car companies that produce in the Philippines 200,000 units of high-volume car models over six years. Mitsubishi has a 2023 deadline for production of its Mirage compact car, while Toyota has until 2024 to produce its VIOS car.

An auto industry group has asked the government to review the conditions for the program after the pandemic caused an industry sales slump.

An interagency group on the CARS program is recommending a three-year extension, targeting the signing of an executive order by the end of June this year.

“We are confident that an executive order on the recommendation of the IAC (interagency committee) for the extension of the compliance period for the CARS program participants would be issued before end of June of this year considering IAC already includes different agencies relevant to issue,” Board of Investments Managing Head Ceferino S. Rodolfo said in an online briefing Thursday.

He added that the required number of cars to be produced and the budget caps will be retained.

“We of course do understand the challenging unforeseen circumstances, including the impact of the pandemic on automotive demand,” Mr. Rodolfo said.

The extended timeline, he said, will also cover investment incurred in the course of refreshing the car models.

Mas gusto natin ‘yan kasi at least sigurado tayo na dito pa rin gagawin ‘yung succeeding model. (We want that because it ensures that the succeeding models will still be made here),” he said.

Car sales in 2020 declined 39.5% to 223,793 units, according to the Chamber of Automotive Manufacturers of the Philippines, Inc. and Truck Manufacturers Association. — Jenina P. Ibañez

BusinessWorld

2021-03-28 07:59:54

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