Toyota Motor Philippines (TMP), the country’s largest automobile distributor, said the price of Innova may go up as a result of higher operational cost because the income tax holiday (ITH) being given by the government expired last March.

In an interview, TMP vice president Rommel Gutierrez said they have already asked the Board of Investments (BOI) for an extension of their four-year ITH to six years.

Gutierrez said that initially, BOI classified Innova as a non pioneer project. But given that it is an Asian vehicle, Gutierrez said that it can be re-classified as a pioneering project. Under the law, pioneer projects are given six years ITH, he said.

If the BOI does not grant their request, Gutierrez said the cost for producing the Innova will go up. Gutierrez said he is not certain as to how this will affect the product.

Innova is one of the two vehicles being produced in their Sta. Rosa plant. The other is Vios. Gutierrez said the ITH for the car is good for a couple more years.

Toyota has already reduced their production of Innova and Vios, the two vehicles assembled in their Sta. Rosa plant, by 10 percent. The move was done as a result of the slowdown in consumer demand worldwide.

Angel Dimalanta, president of the Automotive Industrial Workers Alliance (AIWA) said Toyota has removed one shift every week. Instead of producing Vios and Innova on their Laguna plant, Dimalanta said the workers were asked to do maintenance work.

Dimalanta said the Toyota Plant in Sta. Rosa operates five days a week. Each day is divided into two eight-hour shifts. He said one of the Monday shift has been cancelled since mid January.

According to Dimalanta, a total of 40 units are being produced each shift or 20 units of Innova and 20 units of Vios.

Before the cancellation of one of the Monday shifts, Dimalanta said the plant produces 400 units per week. He said he does not know till when the reduced shift will last. “There is no definite date. It will be like this until the market improves,” he said.

Target production for this year is 12,000 units.

When asked about the 10-percent reduction in production, Gutierrez said “our production continues with some rationalization of costs to manage our overhead.” Gutierrez refused to elaborate on the matter.

By Ma. Elisa P. Osorio, Philippine Star

Tsikot.com Philippines

An automotive manufacturing company with heavy presence in Latin America and Europe is ready to take the Philippine market by storm with the introduction of new passenger car models that are sure to capture the interest of the picky Filipino car buyers.

For 2009, Lifan Cars will introduce to the Filipino car enthusiasts its LF520 mid-sized sedan.

The LF520 enjoys great demand in major markets. The car model has been exported to over 50 countries, including Russia, Vietnam, Iran, Chile and Venezuela, according to Nelson Ong, Lifan Cars president.Ong believes that the company will enjoy commercial success in the Philippine market given the preference of Filipino car buyers to quality but more affordable vehicles.

‘We are confident that the entry of Lifan Cars will help revitalize the domestic industry as it gives car buyers more choices. Car buyers will also enjoy considerable savings without compromising the quality, safety and comfort of their vehicles,’ Ong said.

Likewise, Ong said that Lifan Cars expects to be a major player in the car sector in the long run as the company plans to expand its product portfolio in the Philippine market.

Lifan Cars plans to introduce to the local market at least three exciting car models this year.

Lifan Cars general manager William Agcaoili, meantime, expressed confidence for strong domestic sales given the rising demand for quality but affordable vehicles and the growth of the auto industry in general.

In 2008, Philippine vehicle sales jumped by 6 percent to 124,449 units even as neighboring Asian countries suffered falling sales and profits brought about by the global financial crunch.

‘One major consideration for Lifan’s entry into the market is the availability of a good market. We believe that it will appeal to the young urban professionals and younger car enthusiasts, who comprise a large chunk of buyers in the local market,” Agcaoili explained.

Agcaoili likewise stressed that ‘on top of their good looks, Lifan cars are equipped by powerful engines designed by United Kingdom-based engineering designs firm Ricardo Plc, for that extra torque and speed. They are trendy and the prices are also very competitive,’ he added.

The LF520 will be available to the market immediately after its formal launch on Jan. 30 at Lifan’s showroom in West Avenue, Quezon City.

Lifan Cars is a unit of China-based conglomerate Lifan Group with operations in the financial/banking sector, real estate, football industry and R&D.

Lifan Group has also been engaged in the production of trucks, buses, motorcycles, and car engines. It ventured into automobile production seeing the growing demand for quality but affordable vehicles not only in China but also in the global market.

Lifan Group has been consecutively selected among Chinese Top 500 enterprises and ranks the first among Chongqing Top 50 private-owned enterprises.

Ong said Lifan Cars plans to expand its business in the Philippines by aggressively pursuing nationwide dealership.

PR Inside

Tsikot.com Philippines

PHILIPPINE auto sales may grow at a rate that is higher than what the local industry expects, according to a new study by the Business Monitor International Ltd.

The study also indicated that the relatively unserved market segments would boost growth prospects for 2009.

The London-based market research firm said sales could grow by 8 percent, to more than 127,000 units. The projected growth rate, however, is lower than the 18.3 percent posted in 2007.

The Chamber of Automotive Manufacturers of the Philippines Inc. and the Truck Manufacturers Association said they were expecting to sell only 125,000 units this year, or a growth rate of 6 percent.

“Although BMI expects production to rise in 2008, local assembly is under threat from moves to reduce import tariffs, which would erode the competitive advantage of local manufacturers,” the study said.

Toyota Motor Philippines Corp., being one of the firms that use a high level of local content in its vehicles, would be particularly hit hard, it added.

Still, BMI said industry newcomers had not been deterred, with Chinese carmaker Geely making its debut initially through importation of completely built units and targeting domestic assembly of kits.

BMI added that both Toyota and Geely were expected to tap into market segments that had been relatively unserved, with the latter producing low-cost cars for the BCD income brackets.

Further, BMI cited plans of Toyota to further boost its share of the market through the launch of the Lexus premium brand.

In an interview last week, TMPC president Hiroshi Ito said the company was finally pushing through with the launch of Lexus in mid-January.

Ito said five models–which he declined to name–will be launched simultaneously along with the brand next month.

“A sixth model will be added later to complete the line up for the year (2009),” he added.

He said the introduction of Lexus in the Philippines had been held off several times, partially on account of a still unfinished facility at the Bonifacio Global City.

Tsikot.com Philippines