The Philippine Board of Investments (BOI) recently approved the investments projects of four parts suppliers of Toyota Motor Philippines Corp. (TMPC) worth Php1.28 billion for the Vios model under the Comprehensive Automotive Resurgence Strategy (CARS) Program.
Valerie Product Mfg. Inc. (Php94.5 million), Technol Eight Phils. Corp. (Php495.9 million) will be manufacturing body shell parts while Manly Plastics Inc. (Php520 million) and Toyota Boshoku Phils. Corp. (Php167.2 million) will produce consoles and door trims, respectively under the Body Shell and Large Plastics (BSLP) category, which is covered among the list of manufacturing activities of the program. The parts makers each will be churning out a capacity equivalent to 230,000 units over the six-year life of the registered car model. Production period will be from August 2018 to August 2024.
Under the CARS program, continued support is provided to the parts manufacturing activities of the participants. It also allows for the outsourcing of parts to be owned by the registered carmaker. Additionally, TMPC is investing Php1.98 billion in producing body shells (Php1.22 billion) and large plastics (Php766.5 million) in-house. All told, TMPC and its parts suppliers are investing Php3.26 billion in the CARS Program
“With more investment opportunities from its supplier network and other related manufacturing activities, industrial linkages are strengthened and boost the capacity of Toyota to meet the growing demand of its best-selling vehicle,” Trade Undersecretary and BOI Managing Head Ceferino Rodolfo said. He remains confident that CARS participants would continue to attract additional investments and stimulate demand that will boost the local automotive industry and position the country as an automotive manufacturing hub in the ASEAN region.
The CARS Program is a result of the Industry Roadmapping Project (IRP) launched by BOI in 2012. Under Executive Order No. 182, the thrust of the Program is to provide time-bound and output or performance-based fiscal support to attract strategic investments in the manufacturing of motor vehicles and parts. Other non-fiscal measures provided by existing laws continue to be in place and are being implemented by relevant government agencies.
“CARS complement and strengthen the policy directions of existing motor vehicle development programs of the government. This will ensure a resurgent automotive industry with significant strides in innovation, technology transfer, environmental protection, and SME development which will boost industrial capacity and create more jobs for the country,” CARS-PMO Manager Marissa Concepcion said.
Total fiscal support for the duration of the CARS Program is a maximum Php27 billion with each enrolled Model qualified to a fiscal support of up to Php9 billion, subject to an Automotive Development Fund (ADF) under the annual General Appropriates Act (GAA) of the government. These are obtained in the form of Fixed Investment Support (FIS), 40 percent in cases of parts and shared testing facility and 60 percent for Production Volume Incentive (PVI).
Participants of the CARS program will have to comply with performance-based terms and conditions including the minimum output of 200,000 units over the six-year program period and local production of body shell and large plastic parts. (END)