By Ramon tomeldan
New car program reignites big aspirations, complexities
There’s a buzz around RACE, long before its internal combustion engines have even revved.
Officially dubbed the Revitalizing the Automotive Industry for Competitiveness Enhancement program, it’s being touted as a “critical catalyst in parts localization” and a potential game-changer for the Philippines’ automotive landscape. However, despite its promise, the road ahead remains cluttered with old challenges and new complexities.
Supporters herald RACE as more than a sequel to the Comprehensive Automotive Resurgence Strategy (CARS); they call it a pivot toward a more inclusive, sustainable, and globally competitive sector.
One of its most compelling endorsements comes from Toyota Motor Philippines (TMP), whose Tamaraw Initiative has ignited fresh momentum in localized vehicle production. With 44 Tier 1 suppliers and 14 Tier 2 suppliers integrated into the Tamaraw project—and a ₱5.5 billion investment from TMP, plus ₱500 million pledged by its supplier network—the initiative has signaled robust confidence in the country’s industrial capabilities.
The Toyota Supplier Network (TSN) sees RACE as a logical extension of the gains achieved under CARS. The continuity reflects policy intent to fortify domestic production, attract regional investment, and establish the Philippines as a credible player in Southeast Asia’s auto manufacturing league.
Feasibility blueprint
RACE’s blueprint emphasizes feasibility. Its revised production target—100,000 units versus CARS’ 200,000—makes it more accessible to OEMs. It also incentivizes deeper supply chain integration and tooling investments, opening up opportunities not just for assemblers but also for logistics, processing, and support sectors.
Fiscal support of up to ₱3 billion per manufacturer aims to make local production attractive, while the program’s clearer guidelines may finally offer the predictability investors have long demanded.
But big aspirations come with even bigger questions.
Can the Philippines clear the hurdles that have historically stalled automotive resurgence? Many Tier 2 suppliers still lack the scale and technology needed to meet modern standards.
Regional competitors, such as Thailand and Indonesia, continue to attract investors with faster permitting and more generous incentives.
And while the EV transition looms large globally, the Philippines’ infrastructure and policy frameworks for electrified mobility remain underdeveloped. In the transition to green technologies, RACE encourages energy-efficient models, but the local industry lacks a robust EV infrastructure and supply chain. Without parallel investments in charging networks and battery manufacturing, the shift to cleaner vehicles may stall.
Red tape, fund constraints
Consistent policy execution is essential; however, past programs have been marred by delays and administrative bottlenecks. The automotive industry also requires a skilled, tech-savvy workforce, and training pipelines must evolve rapidly to meet the demands of advanced manufacturing.
Budgetary constraints temper the optimism: RACE’s ₱9 billion allocation is a fraction of CARS’ ₱27 billion purse, raising concerns about whether fiscal support will stretch far enough.
So, as the industry inches toward the starting line, one thing is clear: RACE has reignited the conversation—but whether it accelerates and turns the corner or sputters out depends on what happens after the green light is given. Will the government stay the course and smooth the path, or will the program get bogged down by the familiar bureaucratic traffic?
Only time—and a serious commitment to clearing systemic bottlenecks—will reveal the answer.
