The Philippine Parts Makers Association (PPMA), a group of local automotive parts and components manufacturers, voiced this concern at their recent quarterly meeting.
“We are pushing for the CARS (Comprehensive Automotive Resurgence Strategy) assemblers to prioritize the SME local parts makers to supply in the start of volume production,” said PMMA President Ferdinand Raquelsantos.
For now, Raquelsantos said all they can do is to remind the CARS participants that the main objective of the program to develop and boost local production.
At present, there are only two approved program participants – Mitsubishi Motors Philippines Corp. and Toyota Motor Philippines Corp. Each participant is required to produce 200,000 units of the chosen model over a six-year period to be eligible of the $600-million tax perks under the program.
Based on the implementing rules and regulations of the government’s Comprehensive Automotive Resurgence Strategy (CARS) Program, participants are required to manufacture key automotive parts within three years of participants’ registration with the goal to spur manufacturing activity in the automotive sector.
Participants are required to deliver their output in a matter of 36 months, or three years and small auto parts makers hope to become part of the supply chain of the CARS participants.
Earlier, Raquelsantos said that PMMA was targeting 31 joint ventures and technical agreements with foreign car parts suppliers. These ventures could generate sales output of $5 billion.
Raquelsantos, owner AutoFIR Enterprises – manufacturer and distributor of automotive seatbelts and airbags to original equipment manufacturers (OEM) in the Philippines, said the industry is expected to benefit from these joint ventures with increased business opportunities and technology transfer especially from Japanese companies.
With the CARS program, PMMA is now looking at 60 to 70 percent increase in its current manpower of 70,000.
CARS program specifically targets to generate 200,000 new jobs, bring in fresh investments worth $1.2 billion, stimulate local demand by increasing vehicle sales to $9.2 billion, and effectively implement industry regulations that will revitalize the Philippine automotive industry.