Toyota and Mitsubishi are still a long way from reaching the local production target they promised back in 2016, when the country’s best selling carmakers aimed to each locally produce around 200,000 cars in exchange for getting P9 billion each in fiscal support.
With the government giving them six years to comply with the Comprehensive Automotive Resurgence Strategy (CARS) program, the carmakers began local production in 2017. Latest available data from the Board of Investments (BOI), however, showed the market leaders still have a large deficit.
As of the end of 2020, Toyota Motor Philippines, which committed to locally produce Vios units, still needed to make around 128,000 units. On the other hand, Mitsubishi Motors Philippines, which committed to make Mirage units, still has a deficiency of around 143,000 units.
The CARS program is a P27-billion government initiative under the Aquino administration that aimed to tap three car manufacturers to locally produce a total of 600,000 units by 2022. Only Toyota and Mitsubishi enrolled in the program.
BOI Managing Head Ceferino Rodolfo had said they were confident the government would issue an executive order before the end of June to extend the CARS program for another three years.
The recommendation for an extension came from the Inter-Agency Committee, which the BOI is a part of along with the Department of Finance.
“It only involves the extension of the period of compliance but the volume requirements remain intact,” he added, noting the government understood how challenging the current situation was.
Vehicle and truck manufacturers sold more than 223,000 units last year, marking an almost 40-percent decline in sales when compared to 2019, according to a joint report by the Chamber of Automotive Manufacturers of the Philippines, Inc. (Campi) and Truck Manufacturers Association. Toyota and Mitsubishi are Campi members. INQ