PH auto parts makers group raises concern on CARS, RACE budget removal in 2026 GAA

MANILA: Concerns on the vetoing of the proposed budget for the automotive-industry-related programs continues to snowball — this time, from the suppliers of local produced automotive components, parts and assemblies.

In a statement, the Philippine Parts Makers Association (PPMA) said that the decision to remove the funding for the Comprehensive Automotive Resurgence Strategy (CARS) and the Revitalizing the Automotive Industry for Competitiveness Enhancement (RACE) programs “threatens what remains” of vehicle manufacturing in the country.

Per PPMA, the issue directly affects whether cars will continue to be built in the country at all.

“CARS and RACE are critical to the survival of local car manufacturing,” PPMA President Ferdinand Raquelsantos was quoted as saying. “Without sustained production volumes, there is no viable auto parts industry, and without parts makers, vehicle assembly cannot survive.”

Other stories: MMDA GM Torre to lead agency's major ops Zigwheels PH weekly wrap: December 29, 2025-January 2, 2026 E-trike, e-bike ban on major NCR highways starts today

According to the group, automotive manufacturing is one of the key sectors in Southeast Asia — noting that Thailand is the region’s pickup truck and passenger car hub, Indonesia has facilities for multi-purpose vehicles and crossovers, and Vietnam attracting investments for both internal combustion and electric vehicles.

“In all these countries, locally assembled cars support thousands of parts suppliers, from stamping and plastic injection to electronics and wiring harnesses,” the group noted.

However, PPMA mentioned that Philippines has steadily fallen behind as local assembly volumes remain low, and most vehicles sold in the market are imported as completely built units.

“Automotive manufacturing has always been a core industry in Southeast Asia,” Raquelsantos said. “When you lose local assembly, you lose the ecosystem that supports it. That includes tooling, testing, engineering, and thousands of skilled manufacturing jobs.”

Further, the organization stated that in the 1990s, the local automotive manufacturing reached its peak, with multiple models were assembled locally with higher local content and stronger supplier participation.

“We were almost there,” the PPMA president said. “The factories are here. The suppliers are here. The workforce and technical know-how are here. What has been missing is policy continuity and long-term commitment,” Raquelsantos added.

With that, PPMA is seeking for a dialogue with the government — particularly the legislators on both chambers of the Congress — to better explain how automotive programs work and why they matter to the motoring public.

“This is not just about manufacturers,” Raquelsantos said. “When cars are built locally, you create jobs, develop engineering talent, and strengthen supply chains. We want to sit down with policymakers and explain how CARS and RACE help keep car manufacturing alive in the Philippines.”

Earlier, Senate Finance Committee Chair Sherwin Gatchalian raised his concerns on the removal of the intended budget for both CARS and RACE.

Gatchalian said in an earlier briefing that Mitsubishi and Toyota were promised to be paid through tax incentives — which have not been given for the past four to five years.

Both of which are filed as line items under unprogrammed appropriations, CARS and RACE are eyed to have the following allocations:

CARS	P4.32 billion
RACE	P250 million

Also read:

PPMA ‘concerned’ over lack of gov't support amid automakers’ optimistic sales projection for 2025

ABMAP pushes for govt support on local manufacturing of CBU units

PH body manufacturers eyes PUV modernization program reimplementation

Connect with us through our various social media pages:

Facebook: https://www.facebook.com/ZigWheelsPhilippines

Instagram: https://www.instagram.com/zigwheelsph/

Tiktok: https://www.tiktok.com/@zigwheels

Youtube: https://www.youtube.com/@ZigWheelsPhilippines/