DTI finalizing P3-b perks for electric vehicle manufacturers

The Department of Trade and Industry said Wednesday it is finalizing P3 billion worth of incentives for manufacturers of Euro-4 and electric public utility vehicles.

Trade Undersecretary Rafaelita Aldaba said the program would be contained in an executive order to be issued by President Duterte. It would assist in creating an ecosystem to produce 6.6 million electric vehicles by 2030, she said.

“The public utility vehicles program would provide a P3-billion subsidy to the transportation sector through tax credits to manufacturers, but we’re still waiting for the president’s approval of this particular executive order,” Aldaba said.

We are gearing our strategy towards the development of the electrified public transportation sector,” she said.

The electric vehicle industry is composed of 54 manufacturers and importers, about 19 charging stations and 11 parts manufacturers.

“In terms of industry focus, we are leveraging on our current strengths, and we are positioning the country, not only in EV assembly, but particularly in auto electronics engineering services, outsourcing EV battery charging energy storage systems and recycling,” Aldaba said.

She said the government was positioning the country as a global manufacturing hub for lithium ion batteries, given the rich nickel and cobalt resources in the country, which could be used as cathode materials.

The country ranks sixth in terms of nickel reserves in the world. The Philippines also produces 300,000 to 323,000 metric tons of copper annually.

Under the Electric Vehicle Incentive System, the industry will be given access to fiscal and non-fiscal support to enable the traditional motor vehicle system to shift to EV and jumpstart the development of the EV industry.

A pre-COVID survey conducted by Frost and Sullivan covering ASEAN showed that 46 percent of Filipinos were eager to buy electric vehicles. Tax waiver and the presence of charging stations were the top incentives cited for ASEAN buyers of EV.

Aldaba said that prior to the pandemic, ASEAN countries were gearing their policies and building the momentum towards the EV sector development.

“With COVID-19, all the more countries have been moving in the same direction to a low-carbon economy, using their stimulus packages to invest heavily in EV in public transit as a way to repair the vast amount of economic damage caused by the crisis, and get their citizens back to work,” she said.