Mitsubishi Motors Philippines Corp., one of the two car assemblers participating in the Comprehensive Automotive Resurgence Strategy program, is scaling down its local operations and laying off about 100 employees, a labor group said Monday.
Philippine Metalworkers Alliance secretary-general Rey Rasing said MMPC employees were served dismissal notices on Oct. 16 that would take effect next month.
Rasing said MMPC just terminated about 400 workers in 2018, even as it continued to enjoy subsidy under the CARS program. Another wave of termination is seen too soon, he said.
The Department of Trade and Industry said Monday it was keeping the funds earmarked for the CARS program intact despite the plea by a labor group to reallocate them as part of the social amelioration package for displaced automotive workers.
“I believe we can work on a social amelioration fund for the automotive workers. We can ask the government to cover possible lay-off in the industry. But the fund intended for the Comprehensive Automotive Resurgence Strategy program should be given where it is due,” Trade Secretary Ramon Lopez said Monday.
Lopez said the alleged massive lay-off in the automotive industry was expected as the industry was not spared by the crisis.
The PMA said the DTI should allocate a part of the budget under the CARS program to help the affected workers.
“To start repairing the injustice, allocating a portion of the budget for the CARS Program to provide social amelioration to those already displaced would be a good start,” said Raul Punzalan of PMA.
The PMA also urged the government to carefully consider the employment implications of granting reprieve to CARS beneficiaries and to keep in mind that one of the purposes of the program is employment generation.
“Unless the government wants to subsidize job loss especially under the current economic crisis, then there is no point giving in to the pressure from corporate interest to extend the grace period under the CARS program,” said PMA.
The group said that while car sales declined during the lockdown period, recent reports showed that transport equipment sales started to recover when economic activities resumed.
According to the monthly integrated survey of selected industries by the Philippine Statistics Authority, losses in terms of volume of sales eased from 60.2 percent in May to 35.3 percent in June and 15.5 percent in August.
Data also showed that the lost value of sales also declined from as high as 87.9 percent in April to 24.5 percent in August, which suggests that the automotive sector is gradually recovering.
Meanwhile, the PMA noted signs of recovery in terms of transport equipment production. From a production decline of 84 percent in April, the loss eased to 43.5 percent in August.
The group said production should catch up soon as demand for vehicles was expected to return early next year.