Toyota Motor Philippines said it will expand vehicle production starting this week by returning to two-shift operations to catch up on improving demand and comply with the required production volume under the automotive incentives program.
TMP president Atsuhiro Okamoto said manufacturing was expected to return to original pace before the COVID-19 outbreak.
“By Sept. 14, we will start to see two shifts in Sta. Rosa. That means that our production volume, our production efficiency will return to normal, same as before the COVID pandemic,” he said during the launch of the improved Toyota Hilux over the weekend.
Okamoto said improved production would continue in October but the company would decide either to maintain the current output or “play it by ear” in November, depending on the volume of demand.
He said demand for the Vios and Innova vehicles picked up, encouraging the company to operate in two shifts.
Toyota vice president for corporate affairs Rommel Gutierrez said the company saw the return to two-shift operations urgent to to catch up on missed opportunities for the Vios that were lost to the pandemic.
Vios was the enrolled model under Comprehensive Automotive Resurgence Strategy program.
“It has always been a challenge to meet the target volume requirement of the program. So what Toyota does of course in relation to employment is that we have to keep the current number of workers, so that we will continue to produce the Vios, and of course the Innova. The current program is six years, and we are actually halfway. It is affected by the COVID-19, but we have to face the challenges,” he said.
“Of course we want government to extend the number of years of the CARS program because definitely we cannot comply with the volume requirement as originally said. That was set under normal circumstance at that time. But so many things have happened. It started from the introduction of the new excise tax, which affected the sales. Of course [came] the Taal Volcano eruption, and definitely the COVID-19. So as far as extension of the number of years of the CARS program is concerned, we definitely support that. In fact, we may have to ask that separately,” he said.
The company, he said, would still study how many years would be needed to extend the program that would allow participant-companies to comply with the required 200,000-unit volume.
The Board of Investments said earlier it was willing to add another three-year to the 6-year CARS program.
TMP expects new Hilux sales to reach 5,000 units until December 2020. Toyota already sold 7,000 units of the pick-up truck in the first eight months, or about 13 percent of the total Toyota sales during the period.
The local automotive industry expects 2020 vehicle sales to decline by 30 percent from the previous year, an improvement from an initial projection of 40-percent loss.
“We’ve seen over the past months that the trend is increasing. So we are hopeful that in the coming months, sales would still increase, and it would still be a better year for the auto industry,” Gutierrez said.