Cars, Race funding veto worries local auto group

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January 10, 2026 | 12:00am

MANILA, Philippines — The Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI) expressed concern over the recent veto of the funding for the government’s vehicle manufacturing incentives programs, emphasizing their importance in the development of the local automotive industry.

“Recent developments have raised serious concerns on the funding for the financial incentive commitments granted under the Comprehensive Automotive Resurgence Strategy (CARS) program,” CAMPI said in a statement.

“The participants should be able to receive their incentives based on their actual performance that has already generated economic benefits,” the group also said.

CAMPI also said the Revitalizing the Automotive Industry for Competitiveness Enhancement (RACE) program, which is intended to serve as the successor program of the CARS, is an important program and should be implemented soon.

The statement was issued following President Marcos’ veto of the P4.32-billion funding for the CARS program and P250 million for the RACE program under the unprogrammed appropriations in this year’s budget.

Under the CARS program, the government promised to provide incentives to encourage local vehicle manufacturing.

In particular, incentives would be given to firms that invest and produce at least 200,000 units of their enrolled vehicle model within six years.

Automotive firms Toyota Motor Philippines Corp. (TMP) and Mitsubishi Motors Philippines Corp. took part in the CARS program.

“Both CARS and RACE are fundamental programs that contribute to the overall industrial development of the country,” CAMPI said.

For the group, collaboration between the government and the industry is important in ensuring the viability of local automotive manufacturing.

“It is crucial in creating a positive environment for future investments and in helping develop a more robust local auto parts manufacturing industry,” CAMPI said.

“We fully trust and support the efforts of key government agencies in urgently resolving these important matters,” the group said.

Earlier, the Philippine Parts Makers Association (PPMA) called for urgent government action as it flagged risks posed by the veto of the proposed funding for the CARS and RACE programs.

“CARS and RACE are critical to the survival of local car manufacturing,” PPMA president Ferdinand Raquelsantos said.

Without decisive action, the PPMA said the Philippines could become purely an import market for vehicles and lose the benefits of manufacturing.

For his part, TMP president Masando Hashimoto said that the CARS is a win-win for both the government and private sector in terms of encouraging investments and providing gains for both the manufacturers and consumers.

“We hope for continued mutual trust and collaboration with the government to attract future investments, generate employment, enhance technology transfer, strengthen domestic parts makers and ensure a vibrant manufacturing environment in the Philippines,” he said.

The Board of Investments (BOI), which implemented the CARS program, said it is working with other government agencies to ensure payment of incentives for the program’s participants.

“To our investors, we firmly assure that we are already working with other agencies, principally the DBM (Department of Budget and Management), in identifying a mechanism to ensure payment of CARS arrearages especially as these had been based on validated delivery of performance commitments and on a robust and transparent inter-agency process of vetting claims against the CARS program,” BOI managing head and Trade Undersecretary Ceferino Rodolfo said.