Mitsubishi Motor Philippines Corp. is smoothing out plans to establish an assembly line for the production of a completely-knocked down vehicle in the Philippines.
“They [MMPC] mentioned that they’re expanding into a new model assembly. The plan is contingent on the expansion of the CARS program,” Special Trade Representative in Tokyo Dita Angara-Mathay said, referring to the Comprehensive Automotive Resurgence Strategy program.
She said the Japanese automotive firm had not yet revealed the scope of its intention on adding an assembly line, although there were rumors it was planning to create another line for the Expander model to support production in Indonesia.
Expander is a compact multi-purpose vehicle that has become popular in developing economies like the Philippines.
Mathay said Mitsubishi Mirage, MMPC’s entry into the CARS program, was not as saleable as anticipated. Its sluggish sales were aggravated by the rising cost of fuel.
“We’re hoping they will be making the next-generation Expander here in the Philippines. Right now, it’s being made in Indonesia,” she said.
MMPC has yet to disclose plans on supplemental investments to support the creation of a new production line. It earlier invested in stamping and painting facility required by CARS to produce the Mirage and download the P9-billion subsidy allotted to CARS participants.
MMPC invested around P4.3 billion for machineries to manufacture big parts like panels for car doors and paint shop.
The Board of Investments is working on the extension of the CARS program and proposed to add three years to catch up on lost opportunities for participants.
Under the current timeline, CARS participants—MMPC and Toyota Motor Philippines Corp.—have until 2024 to comply with the program requirements. Mitsubishi needed to produce the required volume of 200,000 units by 2023.
Each participant was required to manufacture at least 200,000 units of their enrolled models—Vios for Toyota and Mirage for Mitsubishi—by the end of the six-year program, in exchange for incentives amounting to P27 billion in fiscal and non-fiscal perks.
The program aimed to generate 200,000 new jobs, bring in fresh investments of $1.2 billion, stimulate local demand by increasing vehicle sales to $9.2 billion and effectively implement industry regulations to revitalize the Philippine automotive industry.