Car manufacturers welcomed the government’s extension of the Comprehensive Automotive Resurgence Strategy program for another five years.
“The extension of the CARS program is a very welcome development. The auto industry expresses its appreciation to the current administration for continuing the government’s strong support to the industry particularly the auto manufacturing sector,” said Chamber of Automotive Manufacturers of the Philippines Inc. president and Toyota Motor Philippines first vice president Rommel Gutierrez.
The extension, approved by President Ferdinand Marcos Jr., seeks to sustain the gains in local automotive manufacturing and encourage more automotive firms to set up assembly and manufacturing operations in the Philippines.
“CARS program is a significant government support as it helps the industry, among others, maintain and promote employment not only to the manufacturers but also parts suppliers and other allied industries. With continued industry-government collaboration, we can further attract more investments for auto manufacturing which is a significant contributor to the Philippine economy,” Gutierrez said.
The program is a result of the Industry Roadmapping Project launched by the Board of Investments 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.
Total fiscal and non-fiscal support provided under the program amount to P27 billion for three registered participants, each with one model qualified to receive support of up to P9 billion, subject to Automotive Development Fund under the annual General Appropriates Act of the government.
The fiscal support comes in the form of tax payment certificates. Participants can use the certificates in offsetting tax and duty obligations to the government specifically excise tax, income tax, import duties and value-added tax.
Other non-fiscal measures provided by existing laws continue to be in place and are being implemented by relevant government agencies.
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.
The only registered participants in the program are Toyota and Mitsubishi Motor Philippines Corp. which were given additional five years to deliver the required production output and put in the necessary investments critical to local vehicle manufacturing.
