Vehicle sales in the Philippines are expected to reach $9.2 billion in the next six years, the Board of Investments said Friday.
Industry forecasts released by BoI showed sales of imported and locally-manufactured vehicles would increase dramatically, as the percentage of households with a capability to buy cars was expected to improve to 26 percent in 2016 and 36 percent in 2017.
“This is something we expect will happen during the duration of the Cars [Comprehensive Automotive Resurgence Strategy] program until 2022,” BoI director Corazon Halili-Dichosa said at the sidelines of the Supply Chain Readiness Training for the Automotive Sector at Acacia Hotel in Alabang, Muntinlupa City.
The government based the sales forecast from the anticipated improvement in competitiveness of the local vehicle manufacturing sector with the implementation of the Cars program.
Vehicle sales in the Philippines increased 21.6 percent in 2015 to 328,854 units from 270,430 units in 2014. The industry expects total vehicles sales to hit 370,000 units in 2016.
Dichosa said the program aimed to speed up local production of vehicles and stimulate local demand by giving time-bound fiscal and non-fiscal incentives to select car manufacturers.
The program targets to generate 200,000 jobs, bring in fresh investments of $1.2 billion and implement industry regulations that will revitalize the Philippine automotive industry to emerge as a regional automotive manufacturing hub, she said.
The government opened the application process to interested yet qualified car manufacturers for the Cars program until end-March 2016.
Qualified participants will get to share the P9 billion worth of incentives the Philippine government will provide under the program.
The industry currently has a manpower of 68,000 directly-hired, highly skilled employees.
Despite a high population base, the Philippines has low motorization rate of 35 per 1,000 people, compared to Malaysia with 395, Thailand with 200 and Indonesia with 73.
The Business Alliance, a partnership between the US-Asean Business Council and the US Agency for International Development, conducted the workshop in cooperation with the Federation of Automotive Industries of the Philippines, the Chamber of Automotive Manufacturers of the Philippines Inc. and the Philippines Parts Makers Association.