AP FILE PHOTO
MANILA, Philippines–Toyota Motor Philippines Co. (TMP) plans to invest another P2 billion in its manufacturing plant in Sta. Rosa, Laguna, as it prepares to embark on a full model change of the Innova given its bullish outlook on the local automotive sector.
This additional capital outlay is on top of the P700 million that TMP earlier committed to invest this year.
On the sidelines of the company’s 26th anniversary celebration Tuesday night, TMP president Michinobu Sugata explained that huge investments were needed for the upgrade of the Innova as the current model was more than a decade old.
New equipment will also be needed to increase the use of local parts for the Innova, to more than 40 percent from the current 30 percent.
Sugata declined, however, to disclose details on when the company expected to roll out the new Innova, but said preparations for the full model change had begun.
Meanwhile, TMP remained bullish on its sales prospects in the Philippines, having raised its vehicle production target to 41,000 units (of Innova and Vios models) this year from the 36,000 units produced at the Sta. Rosa plant last year, and its sales target to 100,000 units from the previous target of 90,000 units.
So far, TMP is on track to meeting its vehicle sales target for this year.
Expected to help boost sales were the continued strong performance of the local economy and the product launches throughout the year.
According to Sugata, the company launched four new models earlier this year, including the Wigo and the Altis.
Under Lexus, TMP will also be launching a new sports utility vehicle model by the end of this month and a sports car by end-2014.
Sugata said the Philippine automotive industry remained quite promising with total industry sales seen reaching 250,000 units this year; more than 300,000 units by 2016; and 500,000 units by early 2020.
At that level, TMP may already consider exporting from its manufacturing plant in Laguna.
“We are prepared for motorization, but exporting locally assembled units may still be too early. We still need to boost local market first then we could export. The local market (in terms of sales) should reach 500,000 units for us to be able to export—that’s the benchmark of Toyota,” Sugata explained.
TMP continues to wait for the road map for the automotive sector, which Sugata said was necessary for the company to decide on whether to push through with additional investments and projects at the Laguna facility.
The proposed automotive manufacturing road map is expected to contain time-bound and performance-based incentives not only for those manufacturers who can invest in their assembly lines to increase their production volumes for export, but also for those that will invest in new facilities for large components manufacturing.
Such a road map was meant to help make the Philippines a competitive manufacturing base for motor vehicles and their parts and components by 2025, and a global hub for automotive-related human resource development.
Although the road map has yet to be issued, automotive players in the Philippines are already highly bullish of prospects in the country, prompting a number of them to expand their operations, raise their production capacities, and increase sales targets.