THE Electric Vehicle Association of the Philippines (EVAP) on Monday urged the government to restore funding for two incentive programs, which it said were critical for the electric mobility sector and the wider automotive industry’s growth.
President Ferdinand Marcos Jr. last week vetoed P92.5 billion in unprogrammed appropriations under next year’s budget, including P4.32 billion for the Comprehensive Automotive Resurgence Strategy (CARS) and the P250 million for the Revitalizing the Automotive Industry for Competitiveness Enhancement (RACE) program.
"Reinstating support for CARS and RACE is a critical step toward ensuring that the country remains competitive in both automotive manufacturing and electric mobility," EVAP President Edmund Araga said in a statement.
The long-term success of the country's electric vehicle sector is linked to the strength of the broader automotive manufacturing industry, the EVAP said, adding that the country's transition to electric mobility cannot succeed in isolation.
“The EV industry does not exist in a vacuum,” Araga said. “Electric vehicles are still vehicles.”
“They rely on the same manufacturing ecosystem, supply chains, skilled workers, and industrial infrastructure that support conventional automotive production. If the local automotive industry weakens, the EV sector will struggle to scale.”
Under CARS, the government committed to provide fiscal and non-fiscal incentives to automakers that produce at least 200,000 units of a registered model over six years. Marcos in 2023 extended the program, launched in 2015, for five years.
The Board of Investments, which prior to the veto said that remaining arrears would be paid this year, has said that it would work with other agencies, to ensure that the government’s obligations are fulfilled.
The RACE program, meanwhile, is envisioned as CARS’ successor, extending perks to automakers that produce 100,000 units of a registered model.
The EVAP said that both CARS and RACE were designed to rebuild vehicle assembly volumes, strengthen local parts manufacturing, and ensure policy continuity for the automotive sector.
"Industry groups have warned that without these programs, the Philippines risks falling further behind Asean neighbors that continue to invest heavily in automotive and EV manufacturing as strategic industries," Araga said.
Among those that have raised concerns about the veto are the Chamber of Automotive Manufacturers of the Philippines and the Philippine Parts Makers Association.