Gov’t: ‘We will not abandon auto industry’
The Marcos administration has reiterated its commitment to the local automotive sector and vowed to settle its remaining obligations to carmakers under the government’s flagship automotive incentive program by tapping available savings from the 2025 national budget.
In a joint statement on Monday, the Department of Budget and Management, Department of Trade and Industry (DTI) and Department of Finance underscored that the veto of the P4.32-billion funding for the Comprehensive Automotive Resurgence Strategy (CARS) Program in the 2026 national budget does not signal a withdrawal of government support for the automotive industry.
Obligations will be settled through declared and verified savings from the Department of Public Works and Highways under the 2025 budget, subject to approval by the Office of the President and compliance with existing fiscal and legal rules.
The savings will be used to augment fiscal support items under the DTI–Board of Investments (BOI) budget within the programmed appropriations of the 2025 national budget.
“The government’s position is clear: we will not abandon the auto industry. Obligations supported by issued and validated Tax Payment Certificates (TPCs) will be paid in a legal, orderly, and responsible manner, consistent with our fiscal space and established budgetary rules,” Budget Secretary Rolando Toledo said.
Decisive action
In separate statements, Toyota Motor Philippines (TMP) Corp. and the Chamber of Automotive Manufacturers Association of the Philippines Inc. (Campi) welcomed the government’s commitment, saying it would restore confidence in the sector after uncertainty over the program’s budget rattled the industry.
“TMP sincerely appreciates the government’s decisive action to reassure investors and stakeholders who have long supported the Philippine automotive manufacturing industry,” said TMP, which enrolled in the P9-billion incentive program.
“This move reinforces confidence in the country as a sustainable base for automotive manufacturing,” it added.
Campi, which represents 28 automotive brands, echoed Toyota’s sentiment, saying the resolution “gives renewed confidence in our industrial policy and puts the automotive sector back on track for long-term investment planning.”
Reportedly, the government has yet to settle a balance of nearly P4 billion owed to participating automakers, including TMP and Mitsubishi Motors Corp.
Meanwhile, validated obligations that have not yet been issued TPCs may be considered for inclusion in the proposed 2027 National Expenditure Program, depending on available cash and fiscal space.
The announcement follows Finance Secretary Frederick Go’s statement on Friday that the government had already found a “funding solution” to the CARS Program, reassuring investors and manufacturers that payments would continue despite the 2026 budget veto.
The funding for the program was among the P92.5 billion in vetoed unprogrammed appropriations in the 2026 national budget, which also included a P250-million allocation for the Revitalizing the Automotive Industry for Competitiveness Enhancement (RACE) program.
Both Go and Trade Secretary Cristina Roque assured the public that the government will continue to support the automotive industry, which they said plays a vital role in industrial development, job creation, and economic growth.
“We are committed to ensuring that the incentives under the CARS Program continue to encourage investors to do business in the Philippines. The industry can expect continued partnership to ensure that the program is implemented in line with its intended objectives,“ Roque said.
“The CARS Program is a key pillar of our strategy to strengthen local manufacturing, and we will ensure that legitimate obligations are paid—consistent with the law and within the capacity of public funds,” Go added.
Automotive groups and a participating car manufacturer welcomed the government’s announcement that funding for its flagship automotive incentive program would push through despite an earlier veto by President Marcos.
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