Isuzu Philippine Corp. has offered an alternative form of compliance to the Comprehensive Automotive Resurgence Strategy program that approximates the value of the required volume of vehicles under the plan.
Isuzu senior vice president Arthur Balmadrid said over the weekend the company was looking at ways to qualify for the program through a mixed commercial vehicle platform, placing the value of the vehicle as a leverage instead of the volume, which the CARS program requires.
“Our proposal if that volume can be smaller but more or less of the same value. Our commercial vehicles are worth almost 10 times that of a small passenger car. So for every 30,000 passenger car units required by the program per year we can approximate at least 3,000 commercial vehicles,” he said at the opening of the Isuzu Off-Road Fest at the Bonifacio Global City.
He conceded the company could produce the mandatory volume that would qualify the company for incentives under the new automotive program.
The company rued the stringent rules the government is asking from car companies in order to be eligible for a set of incentives.
“We were there right from the start when the government is drafting the program. We provided inputs and data that were difficult to extract. We believe we are qualified, in every way, to enroll in the program until the volume requirement came up,” said Balmadrid.
Executive Order 182 or the CARS program provides as much as P27 billion worth of time-bound incentives to three car manufacturers that are willing to put-up investments to produce 200,000 units of passenger cars each, or a total of 600,000 units within six years.
Isuzu said it was willing to put investments to increase production in order to land the third and last slot under the program, on the assumption that the first two would be Toyota Motor Philippines Corp. and Mitsubishi Motor Philippine Corp.
“The investment may not as huge as what is needed to set up new parts manufacturing but the benefits will be shared out to local parts manufacturers, as well. On our part, we still have to invest in bigger stockyard, warehouses and other parts,” said Balmadrid.
Isuzu said it had been using about 50 percent local content for its trucks, securing major parts like cab chassis and body panels from domestic fabricators such as Almazorra and Centro.
Local sourcing is one of the required activities to qualify for incentives in the program.