Mitsubishi unit sees sustained sales growth in PH

MITSUBISHI Motors Philippines Corp. (MMPC) is confident it would sustain its strong growth momentum this year as it expects vehicle sales to grow by 24 percent to 62,000 units this year, from 50,085 units in 2014.
This will enable MMPC to retain its 20 percent market share for 2015, when sales of the local automotive industry are expected to reach about 310,000 units, noted MMPC president and CEO Hikosaburo Shibata.
Speaking to reporters Tuesday night, Shibata said this growth rate was expected to come from the continued strong sales of its current lineup and the launching of three new models in 2015, which the company believed would be supported by local customers.
According to Shibata, the Philippines remained a very important market for the company, given the country’s robust economic growth and in anticipation of the third wave of motorization seen happening here sometime this year.
For this to be realized, however, Shibata urged the Philippine government to issue the much needed automotive industry roadmap that would outline the policies, incentives and key strategies that would support and boost automotive manufacturing.
MMPC, he stressed, had been more than ready to roll out its P10-billion planned investment in the Philippines, which would make the country its third manufacturing hub in the Asean. The proposed capital infusion will be used to increase the current production of MMPC from  about 17,000 units to as much as 100,000 units by 2020.
“The EO for the new automotive manufacturing program has not been issued, and I believe this is very important for Philippine manufacturing business. The car industry can create lots of jobs. If this EO will be issued, other players in the automotive industry will also increase their manufacturing activities and add new models to assemble here,” Shibata said. “We are almost ready to announce the investment. We’re watching what’s going on. Our principal is almost ready to invest (the P10 billion) here but there is nothing to trigger that. I hope the EO (for the automotive roadmap) should be a trigger for us.”
“On Jan. 29, we will have an opening ceremony for our new plant in Sta. Rosa, Laguna,” he said.
MMPC is set to inaugurate later this month its new facility in Sta. Rosa, Laguna where it has transferred operations from its plant in Cainta, Rizal. This facility, which will be producing the L300 and the Adventure, has a maximum capacity of 50,000 units, but the production for these two models in 2015 will only be about 18,000, said MMPC vice president for marketing services Froilan Dytianquin.
Dytianquin noted that should MMPC add a new model to its assembly line, it would be within categories that were showing sustained growth. Among the key growth drivers for the automotive industry last year were small cars, sports utility vehicles, pick-ups, multipurpose vehicles and light duty trucks.
In the meantime, Shibata noted that there were a number of approaches through which the government could support the car manufacturing industry, such as providing tax incentives and easing the registration and other processes involved.
MMPC’s decision to roll out its planned P10-billion investment now hinged largely on the issuance of this roadmap, as this would serve as the “turning point for us and the Philippine automotive industry,” Shibata added.
The government has yet to issue the EO for the Comprehensive Automotive Resurgence Strategy (CARS) program, which is aimed at attracting investments, building domestic scale, and enabling the Philippines to become the regional automotive manufacturing hub. Fiscal and non-fiscal incentives, which could reach $600 million (about P26.4 billion), will be rolled out and granted within a five to six year period and under certain performance conditions.
Apart from the $600-million proposed support, other automotive policy measures meant to stimulate demand included adoption of national standards for auto parts and certification of international quality systems; alignment of Philippine standards with other countries in terms of labor incentives, customs, as well as environment and safety standards; and linkage to government’s refleeting program, among others.
The CARS program will also push for the strict implementation of vehicle registration regulations; full implementation of automated import and export documentation system; the streamlining of regulatory procedures; and allocation of road user’s tax to further improve the country’s infrastructure.