The Board of Investments (BOI) has issued the Implementing Rules and Regulations (IRR) for Executive Order 182 or the Comprehensive Automotive Resurgence Strategy (CARS) program. This is the new version of what used to be the old Motor Vehicle Development program.
With this, the Philippine Part Maker Association lauded BOI's issuance of the IRR for the CARS program.
PPMA President, Ferdinand Raquelsantos, said this was very much awaited by the entire auto industry as it provides for fiscal and non-fiscal incentives aimed at encouraging the local assembly of automotive vehicles.
“Now, we expect the car assemblers to go full blast with their expansion and product development plans that they have temporarily shelved while waiting for this IRR. We expect investments in the auto industry, both foreign and local, to now go full steam ahead,” said Raquelsantos.
Raquelsantos said that the CARS Program was crafted and refined over the last three years and involves numerous consultations by the BOI with the various stakeholders of the domestic auto industry.
Under the CARS Program, two prospective local car assemblers may apply for fiscal support not exceeding PhP 27 billion by locally assembling three vehicle models or PhP9-billion per model with a commitment to produce 200,000 units for each model during its six-year model life.
“Since this will mean an increase in local auto assembly and production of an average of 100,000 units per year or more than double last year’s local production of 88,000 units, this will result in the same increase in the demand and local manufacture of auto parts. This bodes well for us, the local auto parts makers,” added Raquelsantos.
He adds that EO 182 and its IRR even specify that the body shell assembly, large plastic assemblies, common parts and strategic parts will now be the local activities in the program.
Furthermore, Raquelsantos says that PPMA is elated that the CARS Program also provides support for shared testing services and facilities which local parts makers needed.