By Bernie Cahiles-Magkilat
The Board of Investments (BOI) has approved P1.2 billion worth of investments from four parts suppliers of Toyota Motor Philippines Corp. (TMP), which is producing the Vios as its entry model in the Comprehensive Automotive Resurgence Strategy (CARS) Program.
The approved projects are Valerie Product Mfg., Inc. (P94.5 million), Technol Eight Phils. Corp. (P495.9 million), Manly Plastics Inc. (P520 million) and Toyota Boshoku Phils. Corp. (P167.2 million). These firms will produce body shell parts, consoles and door trims 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, TMP is investing P1.98 billion of which P1.22 billion will be spent for the production of body shells and P766.5 million for large plastics. All told, TMPC and its parts suppliers are investing P3.26 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.
Rodolfo remained 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, according to CARS-PMO Manager Marissa Concepcion.
Total fiscal support for the duration of the CARS Program is a maximum P27 billion with each enrolled Model qualified to a fiscal support of up to P9 billion, subject to an Automotive Development Fund (ADF) under the annual General Appropriations 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.