The Department of Trade and Industry is considering a new auto-export program that has a lower number of required units for export to encourage more carmakers to assemble cars in the Philippines and sell them abroad.
The proposed five-year plan, which will replace a program that has already lapsed, requires only 5,000 exported units or $50-million freight-on-board (FOB) value worth of exports annually to get export credits. The old program had a 10,000-unit requirement and only Ford Group Philippines (see photo above) participated in it.
Car exporters will receive credits worth $400 per unit in the first two years of implementation, $300 per unit in the third year, $200 in the fourth year, and $100 per unit in the fifth year.
Motorcycle exporters will earn credits worth $50 per unit since they export 80,000 or $10-million FOB value worth of exports per year.
If the proposed program is approved, exporters would also enjoy value-added tax-free importation of completely knocked down parts.
Trade Undersecretary and BOI Managing Head Cristino Panlilio said stakeholders would be consulted after Trade Secretary Gregory Domingo has gone over the proposed guidelines for the car and motorcycle export plan, which are under the Comprehensive Motor Vehicle Development Program or Executive Order 877-A.
Do you think these incentives are enough to entice carmakers to build cars in the Philippines? Or would you rather drive imported vehicles? Share your views below.