Support the Local Auto Industry

[jpdm]

[SIZE=3]Toyota to increase factory output in 2010[/SIZE]

by Elaine R. Alanguilan
Manila Standard
Dec.3, 2009

Toyota Motor Philippines Corp. hopes to increase the utilization of its assembly plant in Laguna even as the company sees demand for its vehicles bouncing back next year.

Toyota’s assembly plant in Sta. Rosa is operating at 75-percent capacity. It can assemble 25,000 units of Vios and Innova a year at full capacity.
“Definitely there’s growth for Vios and Innova. Demand from the middle market is driving that growth. If there is demand, we want to increase the utilization of our plant.

We want full utilization rate,” Alfred Ty, vice chairman for Toyota Philippines, told reporters yesterday.

He said Toyota could post single-digit growth in sales next year. He declined to disclose numbers.

He said Toyota Motor Philippines, which is majority owned by taipan George Ty of Metrobank Group, could book a higher growth than four percent projected by Chamber of Automotive Manufacturers of the Philippines Inc.

Data from the chamber showed that Toyota was slowly losing market share to other Japanese car makers such as Mitsubishi Motors Philippines Corp. and Honda Cars Philippines Inc., which rank second and third, respectively, in terms of sales.

The entry of cheaper Korean brands, and more recently, Chinese automotive brands, is not helping Toyota.

Toyota sold 36,593 units in the first 10 months of the year, from 37,860 units year-on-year. Its market share fell from over 36 percent last year to 34.5 percent during the 10-month period.



“We have been increasing our investments in auto assembly. Even in parts manufacturing, we have also increased our investments. We would like manufacturing to be healthy,” said Ty at the sidelines of the inauguration of the GT-Toyota Asian Cultural Center in UP Diliman, Quezon City.



Toyota assembles two units, compact sedan Vios, and multi-purpose vehicle, Innova. Both are volume units for the Japanese car maker.


It assembles more units of Vios than Innova, but the ratio could change depending on demand.

Toyota sold 9,601 units of Vios, and 8,050 units of Innova in the first nine months of the year, .

Rommel Gutierrez, vice president for corporate affairs, said about 50 percent of Toyota’s sales in the country were assembled locally, while the other half were imported as completely built-up units.

Yes more local production and less CBU.

[jpdm]

Auto players urged to tap FTAs



Malaya Business Insights
Dec. 7, 2009




Government is urging automotive assemblers to take advantage of the benefits of its trade agreements as a good platform for exporting Philippine-made vehicles and parts and components.


In a speech at the 1st Philippine Auto Summit sponsored by the Philippine Automotive Competitive Council Inc. (PACCI) last week, Board of Investments (BOI managing head and trade undersecretary Elmer C. Hernandez said tariff reduction and elimination under our free trade agreements ( FTAs) will help in providing the competitive edge as well as greater market access for the Philippine parts and components in FTA partner countries.


"We urge the industry to be aware of the benefits provided in each FTA, and take advantage of them," Hernandez said.


By Jan. 1, 2010, further tariff elimination will be carried out in Asean in keeping with our commitments under the AFTA.
Hernandez said domestic manufacturers and assemblers would do well to make the most of the opportunities offered by the greater market access in ASEAN to export their products to the region.


The Japan-Philippines economic partnership agreement (JPEPA) is also in force.


"We are at the threshold of a new era of free trade under the ASEAN and JPEPA. We have been actively participating in FTA negotiations, both bilaterally and regionally, through ASEAN. These include ASEAN-Japan, ASEAN-Korea, ASEAN Australia-New Zealand and ASEAN-India FTA’s.
Hernandez reminded the PACCI members how particularly crucial to the automotive industry .


"Today’s economic environment is crucial for the entire business sector, but is particularly challenging for the automotive industry. We know that local companies have already restricted their business plans and are awaiting government’s response to ensure the long-term viability of the industry,"



Hernandez said the BOI conducted workshops last November 6 to 13 in line with the amendment the Executive Order No. 156 (Providing a Comprehensive Policy and Directions for the Motor Vehicle Development Program and its Implementing Guidelines).


Hernandez said the BOI is now assessing the policies’ relevance in light of the coming full trade liberalization especially in the Asean common effective preferential tariff and the JPEPA.



"We hope to come up with the amendments and new policies to address the imperatives in the coming year," Hernandez said.



The policies hope increase cost efficiency of the industry; expand the domestic market; widen the parts supply base; and gain a foothold in the export market in completely built-up and in parts and components.


New policies may involve, among others the restructuring of the MVDP, inclusion of the parts manufacturing program, alignment of the MVDP with standard and technical regulations and the establishment of a national body to oversee the development of industry.


"We are now reviewing all the inputs for the proposed policy framework, a joint effort of the government and the automotive industry, together with the parts and components manufacturers, and other stakeholders, will set the new direction for the industry that will sustain its viability and lead it back to competitiveness," Hernandez said.


PACCI comprises the Philippines’ biggest domestic vehicle assemblers Ford, Honda, Isuzu, Mitsubishi and Toyota as well as parts manufacturers, the Motor Vehicle Parts Manufacturers Association. of the Philippines.

The members of PACCI collectively represent nearly 90 percent of the automotive manufacturing volume in the Philippines, employ 43,000 Filipinos and account for another 17,000 indirect jobs domestically that support the Philippines’ auto industry.

I really hope the government will immediately implement the new MVDP and support the local auto assembly and manufacturing industry.

[jpdm]

Yes to this!

Mitsubishi invests P200 M to make Lancer cars here

By BERNIE CAHILES-MAGKILAT
December 11, 2009, 6:02pm
Manila Bulletin



Mitsubishi Motors Philippines Corp. (MMPC) has invested around P200 million to upgrade its facility for the local assembly of the new Lancer EX back into the country after it sourcing this popular passenger car model from Thailand and Japan.


This was announced by Mitsubishi Motors Corp. president Osamu Masuko during a press conference for MMPC’s celebration for its 500,000 production milestone in the country since the Japanese automaker started assembly operations in the country in 1964 as Chrysler Philippines Corp.


“MMPC has achieved a strong brand presence for Mitsubishi vehicles in the Philippines, making MMPC the first manufacturer in this country to achieve this 500,000 production milestone,” Masuko said.


According to Masuko, the P200 million investments were used to upgrade its assembly line to include new jigs and fixtures, new welding lines feature spot welding robots and an all new trim and final conveyor lines containing the new electronic control unit programming system.


MMPC has stopped the local assembly of Lancer in 2002 at its Cainta, Rizal plant and instead sourced it from Thailand enticed by low tariffs in ASEAN. In 2008, the company started sourcing the new Lancer EX from Japan .
MMPC expects to sell 200 units a month of the new Lancer EX, which starts retailing at its outlets in February next year at a price of P875,000 to P1.1 million a unit.


In bringing back the CKD (completely knocked down) assembly of Lancer in the country, Masuko said this is the only way to compete in the domestic market noting that its competitors – Honda and Toyota – still assemble their passenger cars in the country.


“MMC has recognized that in order to further strengthen MMPC’s manufacturing capabilities towards globally competitive production efficiencies and quality levels, we in MMC have to provide opportunities for upgrading MMPC’s assembly of new models such as the Lancer EX,” Masuko said.


Masuko said they are targeting sales of Lancer EX to hit 2,000 units annually. At present, MMPC averages 150 units in monthly sales of Lancer.
Masuko further noted that the production of the new Lancer EX will not only benefit MMPC but will also benefit MMPC’s parts manufacturers.


[SIZE=3]“We aim to promote for more local parts sourcing for this model and not relying on imported parts in order to protect it from severe foreign exchange fluctuation,” he added.[/SIZE]


Masuko said that MMC persevered in its Philippine operations despite the ups and downs of the domestic economy.

[jpdm]

RP expansion hinges on government perks - Mitsubishi

By Ted P. Torres
(The Philippine Star)
Updated December 12, 2009 12:00 AM

MANILA, Philippines - [COLOR=blue ! important][COLOR=blue ! important]Mitsubishi[/COLOR][/COLOR] Motors Philippines Corp. (MMPC) said it is capable of rolling out another 500,000 units in the next five years as long as Philippine authorities extend incentives to auto and parts manufacturers.
In a press briefing Thursday, MMPC president Osamu Masuko said that incentives for manufacturers would protect them against foreign currency price fluctuations, thus keeping their production costs low.
“It will keep prices stable,” Masuko said.


He urged authorities to review the program for automobile and parts manufacturers with the end in view of keeping the Philippine automobile industry more competitive against the aggressive markets of Thailand and Malaysia.

“The Philippines has a bright future in the Asian automobile industry,” Masuko said, adding that economic and political stability is essential to attain a higher level of productivity.


MMPC manufactures 500 to 1,000 units a month, or a maximum of 12,000 units a year. Masuko said that a minimum volume of 50,000 units per year for one model would make the Philippines competitive in the region. Such volume would likewise allow MMPC to export to other markets in the region. Mitsubishi’s Thailand operations produce 200,000 units per year of its different pick-up models, making it extremely profitable. Philippine manufacturing plants produce quality sedans like the Lancer and Montero for export in the future.


Meanwhile, MMPC reintroduced the [COLOR=blue ! important][COLOR=blue ! important]Lancer[/COLOR][/COLOR] models as it prepares for the production of bigger and better sedan models.


“We recognize that in order to further strengthen MMPC’s manufacturing capabilities towards globally competitive production efficiencies and quality levels, we have to provide opportunities for upgrading MMPC’s facilities and also enhance the skills of its own labor force towards the assembly of newer models such as the Lancer EX,” Masuko said.


Recently, MMPC invested P200 million to upgrade its assembly line to include new jigs and fixtures, new welding lines feature spot welding robots, and an all new trim and final [COLOR=blue ! important][COLOR=blue ! important]conveyor[/COLOR][/COLOR] lines containing the new electronic control unit programming system.


It had also introduced different models adopting to green technology, driven by biofuels and compressed natural [COLOR=blue ! important][COLOR=blue ! important]gas[/COLOR][/COLOR]
(CNG) in the global market. It will soon launch its electric cars in the world market.


“Mitsubishi Motors’ vision for addressing environmental issues is to lead the [COLOR=blue ! important][COLOR=blue ! important]electric [COLOR=blue ! important]vehicle[/COLOR][/COLOR][/COLOR] era,” Masuko added. It started the mass production of the new-generation electric vehicle known as iMiEV, and it will hit the global roads soon.


“We hope that this EV technology will find its way to the Philippine roads in the future,” the Mitsubishi official said.

Indeed

[jpdm]

Agree with this plan. The best the Philippines can do is assemble/manufacture specific vehicles for the local and export market.

[SIZE=3]Business World[/SIZE]
BY JESSICA ANNE D. HERMOSA, Reporter
Monday, December 14, 2009 | MANILA, PHILIPPINES
[SIZE=3]
[/SIZE]
[SIZE=3]Vehicle Specific Perks Eyed to Lure Investments[/SIZE]


ANTICIPATING A DROP in car import tariffs next year and automakers’ possible decisions to consolidate factories in the region, the Board of Investments (BoI) said it may direct incentives towards a specific vehicle model to carve out a niche for Philippine assemblers.


Specializing in a particular model, officials said, will help ensure that manufacturing activity remains in the country despite the easier entry of vehicles built elsewhere.

"We will find a niche product. We will consult with industry," BoI managing head Elmer C. Hernandez said at the sidelines of a Mitsubishi Motors Philippines Corp. (MMPC) car launch late last week, after officials from the Japanese car firm prodded government to identify an area of specialty.

Osamu Masuko, the president of mother company Mitsubishi Motors Corp., told reporters at the event that they were waiting for government direction before identifying which models to manufacture here when tariffs drop to 0% next year under the Association of Southeast Asian Nations Free Trade Area (AFTA) scheme.

Earlier, a study commissioned by the Philippine Automotive Competitiveness Council, Inc. reported that the pending trade liberalization in the region would strongly affect companies’ investment decisions.

"AFTA will create a more competitive atmosphere for the Philippine industry. MMPC will produce models suitable for this market," Mr. Masuko said.

"We will study the possibility to export locally made models. [But] we have to find out such model ... We are waiting for the Philippine government decision," he added.

Mr. Masuko pointed out that the Thai government favors pick-up trucks, and as a result has lured many car firms to assembling that particular model there.

The Philippines, in contrast, failed to create a niche in assembling Asian utility vehicles (AUVs), the BoI said in its review of the current Motor Vehicle Development Program.

The value-based excise tax system "did not favor AUVs [which] could have been the Philippine ‘winner’ ... and the cost competitiveness of AUVs was eroded", the BoI document, presented at an industry consultation in November, stated.

Mitsubishi, for its part, assured that it will sustain local operations.

"[We plan to sustain manufacturing here] because we’ve already made considerable investment in MMPC plants and facilities," Mr. Masuko said.

He went on to recommend that the government grow the market for locally made cars by strictly banning the entry of imported used vehicles.

"Import of used cars should be strictly controlled ... The revision of the Motor Vehicle Development Program will be a big help," Mr. Masuko said, referring to BoI’s current work to draft a new incentive package.

In November, the agency proposed changing the excise tax structure to differentiate locally made vehicles from imports and providing a larger basket of tax perks for manufacturers that rely heavily on Philippine auto parts.

[ianmitsulancer]

I do hope MMPC gets it right this time... if for some reason they cannot bring in the Fuzion CRDi, i hope that getting the Lancer EX for assembly is the next model to build.

The Study of exporting Philippine made models was a statement of a long time ago... Lets hope that their feasibility study will bear fruit real soon!

[jpdm]

I do hope MMPC gets it right this time... if for some reason they cannot bring in the Fuzion CRDi, i hope that getting the Lancer EX for assembly is the next model to build.

The Study of exporting Philippine made models was a statement of a long time ago... Lets hope that their feasibility study will bear fruit real soon!

Agree here!



I admire Mitsubishi for continuously producing Philippine assembled Adventure, L-300 FB, L-300 Versa Van, BEEP and soon to be Lancer EX. This endeavor helps in making the local auto assembly sector still viable with thousand of Pinoy auto workers given employment and income.

If other auto companies will not do it, I hope Mitsubishi, which is very vocal about it, lead the way.

[victorevolution]

naalala ko mitsubishi helped the malaysian develop thier own indigenous car which is the proton(copy cat of the lancer) now di na partner ang mitsubishi and proton, mitsubishi gave up on proton and proton partnered with puegot/nissan ngayon copy cat ng skoda car design ang proton gen2 or gen3.

i hope mitsubishi do the same thing here in our country.

[The Big Ticket]

truly manufacturing a vehicle in the country means they need to source raw materials locally instead of importing components just to assemble a new car

[jpdm]

I hope Ford can export more from their Philippine factory.

Ford eyes 5% hike in exports
as Asean markets recover


BY IRMA ISIP
Malaya Business Insights
April 5 2010

http://www.malaya.com.ph/04052010/busi11.html#

Ford Philippines is eyeing to grow its export of vehicles by 5 percent this year after a 1 percent hike in 2009.


In a report, Ford Philippines said it shipped 7,277 units of Ford vehicles assembled from its Sta. Rosa, Laguna plant last year from 7,208 units in 2008.


Cumulative exports as of February stood at more than 66,000 units with an export value of more than $800 million since it started its export program in 2002.


In 2010, Ford expects its exports to increase by about five percent as the Asean markets are forecasted to recover and show positive industry growth.


In 2009, Ford experienced an increase in exports despite the Asean markets’ industry decline of eight percent.



In the third quarter last year, Ford Philippines announced the completion of its largest-ever fleet sales order to Ford Motor Indonesia (FMI), exporting a total of 577 Philippine-made Ford Focus units for the Indonesian National Police Force as part of its 2009 fleet program.



Ford Philippines exported over 8,800 engines in 2009, bringing the cumulative total to 28,000 engines.


Ford currently exports CBUs of Escape, Mazda, Focus and Tribute to Thailand, Indonesia and Malaysia and completely knocked-down kits of Focus to Vietnam.


Ford Philippines also exports flexi-fuel engines to South Africa which are used in the Focus sold in South Africa and Australia.

[jpdm]

[SIZE=3]Nissan Unit To Assemble New SUV Model
[/SIZE]
BY BEN ARNOLD O. DE VERA Reporter
Manila Times
April 23, 2010

Nissan Motor Philippines Inc. will assemble a new sport utility vehicle (SUV) that would be sold locally.

Allen Chen, Nissan Philippines president, told reporters the company will start assembly of an SUV mode within the year. He refused to disclose the model, when assembly would begin, and how much additional investment the company would make.


Chen said about 1,000 units of this new model would be manufactured each year.

The company assembles in its Sta. Rosa, Laguna plant the 1.3 liter and 1.6 liter variants of Sentra, Grand Levina, and X-Trail.

Chen said the company’s plant is using only about half of its annual capacity of about 7,000 units.


Nissan Philippines on Thursday night launched the Sentra 200, which would be available in the local market in June. The model has a pre-selling price of between P1.05 million and P1.150 million.

Chen said they target to sell 30 units of this new sedan every month. Units of Sentra 200 are imported from Mexico.



Besides the locally assembled SUV, Nissan Philippines said it would launch another passenger car within the year.

Chen said the company this year targets sales to increase by a fifth from last year’s 2,395 units. The company’s end-2009 sales were down 18.6 percent year-on-year.



http://www.manilatimes.net/index.php...-new-suv-model

More local assembly of CKDs with more local parts please!!!

[jpdm]

[SIZE=3]Mitsubishi Expect Sales To Grow a Fifth
[/SIZE]
Manila Times
April 26, 2010

http://www.manilatimes.net/index.php...o-grow-a-fifth

MITSUBISHI Motor Philippines Corporation (MMPC) expects this year’s sales to grow by a fifth. Citing a growing domestic market, Masahiko Ueki, MMPC president, told reporters the company forecast sales to reach between 27,000 and 28,000 units this year, from 23,247 units last year. MMPC on Friday night launched the 7th generation Fuso Canter light duty truck series, which has three variants: the four-wheeler FE71 and six-wheelers FE83 and FE85.

The suggested retail prices are P1.12 million for the FE71; P1.255 million for the FE83; and P1.355 million for the FE85.

Ueki said they expect sales of Fuso Canter trucks this year to reach up to 500 units by yearend.

He said the company already sold about 300 units of the Lancer EX so far.

MMPC recently resumed the local assembly of the sedan model. Ueki said the company targets to sell a total of 1,500 units of Lancer EX by yearend.

He said they plan to increase the local content of the Lancer EX. At present, only about 5 percent of the sedan’s components are sourced locally, he said.

Besides Lancer EX, MMPC also assembles in the country the Adventure and L300 models, as well as Canter trucks.

Ueki said MMPC would soon launch a small crossover sport utility vehicle that would compete against Honda’s CRV and Hyundai’s Tucson.
Ben Arnold O. De Vera

More local assembly of CKD with more local parts to spur the local auto industry.

[ianmitsulancer]

^^^ agree!

as for the Lancer EX... as for the 5% local content, i guess that is the reason why the price vis-a-vis its Japanese assembled counterpart hasn't dipped as much as we expected to. Yes, increase the local content and CKD assembly (read: Fuzion!) BUT never compromise quality!!!

[Newcomer123]

Ueki said MMPC would soon launch a small crossover sport utility vehicle that would compete against Honda’s CRV and Hyundai’s Tucson.

Eto ba yun?

[kishAn]

Eto ba yun?

is that the new outlander?

[tidus1203]

Nah that's the smaller RVR... Mas maliit pa siguro ito kaysa sa CR-V and Tucson...

[jpdm]

^^^ agree!

as for the Lancer EX... as for the 5% local content, i guess that is the reason why the price vis-a-vis its Japanese assembled counterpart hasn't dipped as much as we expected to. Yes, increase the local content and CKD assembly (read: Fuzion!) BUT never compromise quality!!!

Perhaps, they need to source some of the components from some Philippine based parts manufacturer say Yazaki Torres and Kyoritsu (wiring harness), Yokohama (tires), Asahi ( auto glass), radiators (Roberts), upholstery and aircon.

This will bring down the price of Mitsu cars and might help in spurring demand again.

I hope to see more local CKDs than CBUs and those illegal SUVic (like the Korean and japanese smuggled vehicles)

[KCMenteryo]

Maybe they should also source engine and transmission locally. I think they have transmission assembly sa pinas

[jpdm]

[SIZE=3]Ford Reports Double Digit Sales, Set New Car Launch[/SIZE]



Manila Times
May 6, 2010



http://www.manilatimes.net/index.php...new-car-launch

Sales of Ford Group Philippines further grew in April, as the company expects faster growth this year with the launch of more vehicles, including the fast-selling Fiesta.


In a briefing, Richard Baker, outgoing Ford Group Philippines president, said the company sold 1,023 units last month—the second time that it has sold over 1,000 units in a month.

Baker said sales of Ford and Mazda vehicles in April grew 17 percent and 60 percent, respectively.

Total sales in April were higher by almost a third from the previous month, he said.

Ford Group Philippines had targeted sales this year to go up 20 percent from 8,184 units last year.

It had also projected exports this year to grow by up to a 10th from last year’s 7,277 units—which Baker said could be the highest export volume since 2005.

The US automaker’s local unit has supply agreements with Ford’s subsidiaries in Indonesia, Malaysia and Thailand—where it exports the models Escape and Focus—as well as with Mazda in Thailand.

Baker said Ford Group Philippines this year would jack up to about 15,000 units its production at its Sta. Rosa, Laguna plant, from about 11,000 last year. But this is still less than half of the plant’s installed annual capacity of 35,000 units.

Baker said the company will launch in the Philippines this year the Fiesta—currently one of the fastest-selling subcompact car models in Europe—but he declined to provide details. He said this model would compete with top-selling Japanese models such as Honda’s City and Jazz and Toyota’s Corolla and Vios.

Ben Arnold O. De Vera

Yes!

[jpdm]

BoI to create committee to review auto excise tax

By BERNIE CAHILES-MAGKILAT
May 10, 2010, 9:32pm
Manila BUlletin


The Board of Investments is set to create a committee, composed of government agencies and auto industry players, to determine the changes in the automobile excise tax needed to boost auto sales and to grant preferential treatment for low-priced locally assembled vehicles.


An official source said the committee will determine the appropriate recommendations for the legislative branch to restructure the automobile excise tax system, which was set in 2003 under Republic Act No. 9224, An Act Rationalizing the Excise Tax on Automobiles.


The review of the automobile excise tax is directed at addressing the diminishing sales of the Asian Utility Vehicle and to prop up the planned new vehicle category, the Philippine Utility Vehicle (PUV) under the new Motor Vehicle Development Program.


The intention is to revive the vibrancy in the AUV sector and the promotion of the PUVs by giving these vehicle categories some favorable excise tax treatment. These vehicle categories are deemed the most affordable among vehicle categories, have high local content that could promote the development of the local auto parts and components industry and create more employment.


An official said that BOI has to rely on the recommendations of the committee for the legislature as the repeal of the excise tax issue will be dealt by Congress.


”That is why we are seeking the commitment from the industry stakeholders,” the official said. He also noted that the repeal of the law should not result in revenue loss for the government as it may just shift the tax burden to other categories, probably the luxury vehicles. The Department of Finance will be part of the committee.


Before the passage of RA 9224 in 2003, AUVs were not subject to excise tax payments because they are intended for entrepreneurial activities like transport of persons and goods. At that time, the AUV must have a seating capacity of 9 passengers and must adhere to a required small engine size to avail of the tax exemption.


The implementation of the law in 2004 was blamed for the start in the decline in the sales of AUVs because it removed the tax exemption granted to this vehicle category with the imposition of a value-based excise tax on all vehicles regardless of the seat capacity and engine displacement qualifications.


Under RA 9224, an excise tax of P12,000 plus 20% of value in excess of P600,000 for vehicles with a net manufacturer's price of from P600,000 to P1.1 million, the price range of the AUV. This is in addition to the income tax and now, the E-VAT that are imposed on vehicles.


A 2003 study conducted by the University of Asia and the Pacific analyzing the Philippine automotive industry showed that the excise tax effectively increased the price of the AUV by approximately 3% to 7%.


The year after, AUV sales went down by 7,843 units (down 25.7%) from 30,507 units in 2003 to 22,664 units in 2004. Although it rose slightly to 26,391 units by 2005 (up 16.4%), it was still way below the pre-excise tax level. By 2006, the AUV sales still could not recover as it posted an even lower 25,112 units (down 1,279 units or 4.8%), the study showed.


Looking at the year 2004 alone (the year after the excise tax was imposed), for an AUV with a net price of P600,000, the excise tax collected at 2% (the rate for a net manufacturer's price of up to P600,000) and a sales volume of 22,664 units amounted to about P272 million.

http://www.mb.com.ph/articles/256823...uto-excise-tax

This should be vigorously pursued and implemented.