BOI scraps 3rd CARS player, shifts to PUV

MANILA, Philippines - The Board of Investments (BOI) has officially scrapped the slot reserved for a third participant in its Comprehensive Automotive Resurgence Strategy (CARS) program, shifting its focus to a new program that will support the assembly of eco-friendly public utility vehicles (PUV) priced below P1 million, its top official said.

Trade Secretary and BOI chair Ramon Lopez said no other automotive manufacturers, aside from Toyota Motor Philippines and Mitsubishi Motors Philippines, felt they would be able to meet the CARS program’s 200,000-unit volume requirement over a six-year span, thus leaving the two mentioned carmakers as its only participants.

“There were really no other players. But the good aspect of this is that this, in turn, will benefit more because the budget will now be placed to support the PUV modernization,” Lopez said.

The P27-billion CARS program, which was approved under the Aquino administration, seeks to encourage local car assembly through incentives and allow industry players become more competitive.

The program was supposed to attract three prospective local car assemblers with incentives worth P9 billion each by committing to produce 200,000 units for a chosen model during its six-year model life.

The fiscal support will be given in the form of tax payment certificates to be used to defray the participating car companies’ tax and duty obligations.

“We will reallocate the budget for the third slot, which is around $200 million, for this PUV modernization local manufacturing to broaden the benefit and still encourage local manufacturing,” Lopez said.

Lopez said they target to come out before year-end with the vehicle’s concept, but initially, he said the output should be priced below P1 million per unit.

“The price range has to be lower than what is available. It has to be below P1 million because P1 million is already expensive for a commercial vehicle,” he said, adding it should have a bigger capacity than the existing public utility jeepneys and its design should be safer and more convenient for the people.

“Local guys can supply all requirements as they reinvest in local production. We can develop a program that will enjoin local manufacturers to collaborate and have industry facilities,” Lopez added.

Lopez said other government financing institutions, meanwhile, are expected to come up with vehicle acquisition financing programs for transport groups and cooperatives that will participate in the program.