Amid the resistance received by its decision to impose provisional duties on imported vehicles, the Department of Trade and Industry (DTI) took a swipe at the very same industry that decision is trying to protect.
“The position of CAMPI (Chamber of Automotive Manufacturers of the Philippines Inc.) just shows they import more than (they) manufacture locally. The CAMPI’s concern on sales shows they are selling more imported cars,” said DTI Secretary Ramon Lopez in a text message to reporters. CAMPI is the industry association of predominantly assembler companies with 9 regular and 7 associate members.’
That claim is not baseless as the Philippine (Auto) Parts Maker Association (PPMA) which welcomed the DTI’s move said in 2019, sales of completely built-up (CBUs) units accounted for 88 percent of total sales while those assembled from completely knocked-down (CKD) kits had a share of 12 percent.
PPMA said this is a stark reversal from 1997 when CBUs only accounted for 20 percent.
Lopez said sales of CBUs jumped from 88,013 in 2010 to 274,847 in 2019.
In a statement on Monday, CAMPI said the provisional duties will result in further reduction in sales volume which in turn poses risk of employment downsizing, which is the opposite of what the DTI safeguards imposition is aiming for.
Lopez also said imported CBUs are not banned but that the DTI’s decision will give consumers the option to buy, and the dealers the ability to sell, more of the locally-made vehicles such as Toyota Vios and Innova and Mitsubishi Mirage and L300.
Lopez also noted the prices of these models will not change and therefore will be more attractive to buyers.
“If we don’t impose this safeguard, after finding Injury to local industry, then we are risking the remaining jobs of the Filipino workers. Injury to the local industry was proven so we supported the petition of the Philippine Metalworkers Alliance (PMA),” he said.
Lopez said from close to 100,000, there are now 86,000 jobs in local vehicle manufacturing, including the makers of auto parts, metal works, plastic, wiring harness etc.
He said these jobs have been affected adversely by the increasing vehicle imports.
PPMA in a statement said local manufacturing for automotive parts has drastically reduced.
“Company membership in our association has gone down from 128 firms in 2015 to 49 companies by end of 2020. Some of these remaining companies are not in commercial operations since their clients do not have production requirements,” said Ferdinand Raquelsantos, PPMA president.
Raquelsantos lamented the fact that the vehicle manufacturing industry has been “swallowed by all these free trade agreements” that have made imports cheaper to the detriment of industry workers.
He said if not for the Comprehensive Automotive Resurgence Strategy that incentivizes the production of Toyota Vios and Mitsubishi Mirage, the Philippines could have completely lost passenger car assembly. Honda Cars Philippines has shut down its assembly operations last year.
Labor union Sentro meanwhile in a statement said the provisional measure will protect the local industry which has been reeling from the surge in imported vehicles and which in turn has caused the loss of jobs for thousands of Filipino workers and threatens the employment of many more workers.
SENTRO said in 2019 alone, more than 1,000 automotive workers have been laid off by car manufacturers and their supply chains.
It said the local automotive industry, both assembly and auto parts manufacturing, directly employs almost 40,000 workers, primarily in Region 4-A. Alongwith its supply chains, the industry supports the livelihood of 340,000 formal and informal workers.