The Department of Trade and Industry (DTI) has resubmitted the revised Motor Vehicle Development Plan (MVDP) to Malacañang after explaining that they have already made second hand importation more restrictive.

“There was no change in the MVDP,” Trade Secretary Jesli A. Lapus told reporters.

According to Lapus, they only made clarifications because Malacañang returned the MVDP to them after receiving letters from the Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI) and the Fair Trade Alliance (FTA).

“I don’t see any conflict there at all. They can sign the MVDP if they accept our explanation to their queries,” Lapus noted.

He said the group has been asking about the prohibition.

In a separate interview, CAMPI president Elizabeth H. Lee said that there is a need to review and revise the current MVDP. “They have to strengthen the current tone.”

She said the article on the importation of used vehicle should be tighter and stronger in order to lend support to the local industry.

For their part, the Philippine Automotive Competitiveness Council Inc. (PACCI) said the current auto program needs updating to address the competitiveness of domestic auto manufacturing in view of opening up of the markets in the region.

PACCI said the local automotive manufacturing industry is currently under immense pressure as evidenced since the domestic auto manufacturing industry is currently operating at just a quarter of installed capacity or 60,000 units out of 250,000 units of installed capacity.

As of 2009, the sales of locally manufactured vehicles has drastically gone down to 63,813 units which is 49 percent of the total car sales, from 145,888 units or 90 percent in 1996. The proliferation of used vehicle imports and the high growth rate of brand new vehicle imports have contributed to this decline which causes a drain on foreign exchange.

PACCI added that the significant decline in the locally manufactured vehicles translates to about 50 percent loss of direct jobs from 140,000 to about 70,000, including those from parts’ manufacturing sector over the last 10 years.

PACCI is confident that the New MVDP will address key competitiveness and productivity concerns of the industry, resulting in sustainable economic benefits – more quality jobs, increased investments and more government revenues – providing tangible success of the government’s industrial policy.

PACCI’s primary objective is to support the Philippines’ domestic auto and auto parts’ manufacturing industries and increase their overall competitiveness.

Philippine Star

Tsikot.com Philippines

Domestic automotive players have rejected the new Motor Vehicle Development Program (MVDP) questioning some provisions including allowing the entry of used motor vehicle parts and components that it would be better for the government to maintain the old program.

In a letter sent to Malacañang dated March 1, 2010, Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI) president Elizabeth H. Lee has sought Malacanang’s intervention as Trade and Industry Secretary Peter B. Favila has already endorsed the Executive Order for the new MVDP for President Gloria Arroyo’s signature.

Favila’s endorsement of the new MVDP was among his last efforts as DTI Secretary. Favila’s appointment as member of the Monetary Board, the policy making body of the Bangko Sentral ng Pilipinas, took effect last March 5, 2010.

“It is in this light that the industry is appealing to you to maintain the current MVDP (EO 156) to avoid creating uncertainties and instability in the industry. Our investments and business plans are anchored on the framework and policy objectives of EO 156 particularly the prohibition of imported used vehicles including used engines, parts and components,” Lee said in a letter addressed to President Gloria Arroyo.

Lee said the new MVDP provisions would only frustrate the government’s goal of developing the local automotive industry, particularly the CKD assembly.

One of the major revisions in the draft EO, Lee said is the reclassification of imported used engines and other components from prohibited to regulated importation.

“Instead of strengthening the prohibition, this revision effectively relaxed the importation of these commodities which will undermine the viability of the auto industry and retard the growth of CKD vehicle production to the detriment of the workers, assemblers and parts and components manufacturers,” Lee said..

Lee also said that this policy shift could result in the dismissal of pending cases against the previously unlawful importations of used engines and components thereby negating whatever gains of the government’s anti-smuggling efforts. “We firmly believe that the current MVDP (EO 156), with no less than the highest court of the land affirming your policy on used vehicles, is one of the major legacies our your administration. The gains of EO 156 must be sustained to further strengthen its implementation to fully realize its objectives,” Lee said.

Lee cited Arroyo for a successful watch of the industry noting that the industry’s share in the annual initial vehicle registration has exceeded 50 percent for the first time in more than 10 years.

Lee cited the president’s efforts with the favorable ruling of the Supreme Court upholding the government’s policy against the importation of used motor vehicles under EO 156.

Manila Bulletin

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The planned entry of Chinese motor vehicle assemblers in the local market should be considered in the formulation of a new Motor Vehicle Development Program (MVDP), which used to cater only to the Japanese and American motor vehicle investors.

Elizabeth H. Lee, president of the Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI), said the planned MVDP must be fair and transparent to all stakeholders not just the existing assemblers but also parts makers, the new investors that have committed to come in, and the labor sector.

“A fair and transparent MVDP should be a result of a thorough review. As such, it will entice new investors into the industry,” Lee said.

Lee said that the entry of the Chinese firms into the domestic motor vehicle assembly and parts manufacturing is good news for the local industry largely because it entails the creation of additional job opportunities.

Hernandez for “bringing home the bacon.”She cited Trade and Industry Undersecretary and Board of Investments managing head Elmer C.

Lee in particular cited the plans of the Chinese motor vehicle assemblers to not just assemble for the local market but also for the exports market and their intention to produce major motor vehicle parts here.

She also cited a plan by the Chinese to produce “budget cars” for the C & D market noting that none of the existing local assemblers or even the imported completely built-up units is serving that market.

“I believe a budget car should be below the P400,000 level,” Lee said. Even the imported small cars being brought in by the Korean car firms and the Chinese car brands have prices over P400,000 a unit.

“Because the Chinese would like to produce and source locally then there is a potential to be able to sell their products at cheaper prices,” Lee added.

The Manila Bulletin

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