Toyota Motor Philippines (TMP) chairman Alfred Ty addressed the growing challenges in local automotive manufacturing, stressing the importance of increasing local production to create Filipino-made vehicles for the local market.
Ty, speaking at a recent media event, acknowledged the demand for concessions, pointing out that while volume growth is evident, local content and production continue to lag.
“I’m not surprised that they’re [automotive parts makers] are asking for concessions. The volume is growing, but local production and content remain challenged. It’s still largely Toyota and Mitsubishi handling manufacturing here. I hope we can attract more manufacturers to set up plants in the Philippines and produce locally. Filipino products for Filipinos—that should be our mantra for the entire industry,” he said.
Ty emphasized the need for a collaborative effort to overcome these challenges.
He said one of the primary hurdles is the competition posed by alternative sources, such as Thailand and Indonesia, where production costs are often lower.
“It’s easy to give a number, but the real question is: what parts can we locally produce? What is feasible to manufacture here, considering the alternatives from neighboring countries?” Ty said.
Toyota president Masando Hashimoto, in response to inquiries about the highest local content in Toyota’s models, said Vios holds the highest at about 52 percent local content, which he believes is the highest in the industry.
However, he admitted this is still far from ideal, emphasizing that achieving competitive pricing remains a significant factor in the company’s decisions on local production.
“The challenge isn’t just about investment—it’s about being competitive. Otherwise, why would we or any other carmaker continue to manufacture here instead of importing parts from lower-cost countries,” Ty said.
He said the call for greater local manufacturing comes as the Philippine government continues to push for the growth of the automotive industry, but without addressing these competitive challenges, efforts to increase local production could face significant roadblocks.