The Philippine Star | Louella Desiderio – January 1, 2019 – 12:00am
MANILA, Philippines — The local unit of Japanese carmaker Toyota Motor Corp. is planning to invest P1 billion this year to increase the local content of the Vios vehicles being produced under the Comprehensive Automotive Resurgence Strategy (CARS) program.
The company, which expects a recovery in vehicle demand this year, also sees a single-digit percentage growth in production output.
Toyota Motor Philippines Corp. (TMPC) president Satoru Suzuki said his company is investing around P1 billion next year for the CARS program.
The investment, he said, forms part of the P5.4 billion committed by Toyota for the CARS program.
TMPC first vice president Rommel Gutierrez said the investment would be used for the localization of parts of the vehicles. “Localization program is continuing. We continue to increase the local content,” he said.
The Vios is TMPC’s entry in the CARS program being implemented by the government to position the country as an automotive manufacturing hub by providing fiscal and non-fiscal support to participating firms.
Trade Secretary Ramon Lopez said earlier the target under the CARS program is to achieve 50 percent localization of program enrolled-models.
During the launch of the all-new Vios held earlier this year, Luis Marcelino, senior vice president for manufacturing at TMPC said the local content of the new Vios is now at 40 percent.
TMPC assembles the Vios and Innova vehicles at its plant in Laguna.
Asked for an outlook on production this year, Suzuki said production is expected to post single-digit percentage growth from around 46,000 units last year.
“We experienced negative growth last year so, very difficult for us to think very very bright this year suddenly,” he said.
He said sales of the company are expected to grow this year as demand for vehicles improves.
Gutierrez said earlier the company’s sales are expected to grow by 10 percent this year.
Demand for cars has been affected by the implementation of increased excise taxes on vehicles and high inflation rate, leading to the decline in automotive sales this year.
For the January to November period, TMPC sold 138,476 vehicles, down 16.9 percent from 166,601 vehicles in the same period in 2017.
“We think growth should be positive this year, but not rapid like we experienced before. We believe the market will be growing positively,” Suzuki said.