Incentives offered by the government may help accelerate the growth of electric vehicle (EV) manufacturing, but Toyota Motor Philippines Corp. (TMP) said local suppliers must first be ready to deliver cost-efficient and quality parts that would enable auto makers to benefit from the EV shift.
At the 27th Toyota Special Economic Zone (TSEZ) Update Meeting with the Philippine Economic Zone Authority (Peza), the government’s Electric Vehicle Incentive Strategy (Evis) was identified by TMP and Toyota Group suppliers as a potential source of business for domestic manufacturers, provided they can meet the demands of the EV supply chain.
TMP said the Philippines needs to strengthen local supplier capabilities as the government pursues a dual strategy of sustaining conventional vehicle manufacturing while building capacity for EVs and their components.
The company said local manufacturers must be equipped to supply auto makers competitively and participate in regional and global value chains, underscoring that incentives alone would not be enough to bring them into the EV industry.
TMP also reiterated its willingness to participate in the Revitalizing the Automotive Industry for Competitiveness Enhancement (RACE) program, pending the government’s completion of a joint administrative order and implementing guidelines.
The company intends to register its locally manufactured Tamaraw under the program.
CARS commitments
Alongside efforts to prepare suppliers for EV production, TMP said there is a need for government to fulfill existing commitments under the Comprehensive Automotive Resurgence Strategy (CARS) program, which supports local vehicle assembly and parts manufacturing.
The CARS program supports local vehicle assembly and parts manufacturing.
Last August, Trade Secretary Ma. Cristina A. Roque said the government had released more than P4 billion in payments owed under the program to participating auto makers and small and medium-sized parts manufacturers.
The statement followed questions during congressional budget deliberations about a reported P1.5-billion government obligation to TMP.
TMP, however, did not specify which outstanding commitments it was referring to during the recent meeting.
Meanwhile, Toyota Group export suppliers are projected to generate $1.06 billion in export sales in 2026, down slightly from the $1.09 billion recorded in 2025, amid softer demand and global trade uncertainties.
Peza said Toyota’s 13 export suppliers have generated more than P34 billion in cumulative investments and created over 45,000 direct jobs. Five companies operating within the TSEZ employ more than 7,000 Filipinos.
Toyota Group companies and zone locators also raised operational concerns involving customs processing, electricity costs, regulatory requirements and tax assessments.
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They called for continued coordination between Peza and other government agencies to address these issues and sustain a competitive environment for manufacturers.