PNoy orders new industry roadmap for auto manufacturing

PNoy orders new industry roadmap for auto manufacturing
By: Ben Arnold O. De Vera, InterAksyon.com November 25, 2013 6:31 PM


MANILA - A roadmap aimed at reviving the country’s automotive manufacturing sector hit a roadblock after President Benigno Aquino III ordered the Board of Investments (BOI) to draft a “different” program for the industry. Industry and government sources told InterAksyon.com that the Department of Trade and Industry (DTI) presented the Philippine Automotive Manufacturing Industry roadmap during last week’s meeting of the National Economic and Development Authority (NEDA) Board, which the President chairs. The BOI is the investments promotion arm of the DTI. However, “maraming tanong ang Presidente” about the proposed automotive roadmap shepherded by the BOI, an industry source said. Another source said the President asked about how the roadmap “differed” from the various auto manufacturing programs that past governments undertook, and how it was different from neighboring Malaysia’s program, which led to the establishment of national carmaker Proton. The same source said the President's queries on the proposed Philippine automotive manufacturing industry roadmap was cut short due to time constraints, but gave the BOI enough to chew on. The BOI is proposing to support domestic automotive assembly by providing non-tax incentives, as the Department of Finance (DOF) has been lukewarm to giving away tax perks to assemblers, a source said. Local auto manufacturers have been blaming the lack of government support for the declining share of locally assembled vehicles vis-à-vis imports in the market. Latest industry data show that the market share of locally made units declined to 34 percent in the first half of this year from 39 percent last year. Imported vehicles -- mainly from neighboring Thailand, which is Asean’s automotive manufacturing hub, as well as Japan and South Korea -- have dominated local car sales with a 66-percent market share—the highest-ever—at end-June. Local assemblers could no longer compete head on with their counterparts elsewhere in Asean, which have bigger domestic markets and where production costs are cheaper than in the Philippines. The cost to assemble a car in Thailand, for instance, is 14-percent lower than in the Philippines.

http://www.interaksyon.com/business/75564/pnoy-orders-new-industry-roadmap-for-auto-manufacturing