Carmaker readies P4.5B CBU hub amid tariff threat

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    The country’s leading assembler is investing P4.5 billion on hub dedicated to its imports of completely built-up (CBU) vehicles, coming at a time when government is threatening to slap additional duties on CBUs.

    Satoru Suzuki, president of Toyota Motor Philippines Corp. (TMP), described as anti-free trade a move by the Department of Trade and Industry to impose safeguard duties on CBUs as petitioned by automotive workers.

    The move is meant to discourage the entry of imports and attract more investments in automotive assembly.

    “I don’t know what government will do… but if (it will stop) importation or (impose) higher tariff, that will affect our sales volume,” said Suzuki who ends his term at the end of the year.

    Suzuki said TMP is “worried” about the move which he noted would create “damage to the industry.”

    Alfred Ty, TMP chairman, said the petition for safeguard duty should be opened for discussions.

    “We cannot just look at it at face value,” said Ty, adding that TMP operates both on completely knocked-down and CBU basis in noting the possible impact of higher duties.

    “The more sales, the better it is for the operating companies… as long as property tax are paid. We have to look at it as a whole,” Ty added.

    Suzuki said the CBU logistics hub has been in the planning stage for the past two years.

    Suzuki said TMP will pursue the project despite a possible higher tariff on CBUs although he noted the company may be investing “ in a property which we won’t need.”

    The logistics hub to be located somewhere in Luzon is set to be operational by next year and will make CBU handling more efficient.

    TMP’s current stockyard near its assembly plant in Sta. Rosa, Laguna will handle all locally-made vehicles.

    “Our sales volume is expanding more and more. Sooner or later our stockyard capacity will overflow so we need to establish a new, bigger logistics center,” Suzuki said.

    He declined to elaborate but said the Luzon hub would be bigger than the current stockyard which can handle up to 5,000 cars at any one time.