THE government is settling billions of pesos in unpaid automotive incentives before rolling out a new program aimed at strengthening the local industry, with the Revitalizing the Automotive Industry for Competitiveness Enhancement (RACE) initiative now down to its final steps, Trade Secretary Ma. Cristina Roque has said.
Roque said the government has already released more than P4 billion in incentives under the Comprehensive Automotive Resurgence Strategy (CARS), covering payments to participating automakers and small and medium-sized parts manufacturers.
‘That’s the total. Including the small and medium enterprises. Yes, the parts makers,’ Roque told reporters on the sidelines of a Department of Trade and Industry (DTI) event on Wednesday.
The release covers the incentives owed under the CARS program, including the obligations that had been raised during congressional budget deliberations.
During the congressional budget hearing on Tuesday, Cagayan de Oro City 2nd District Rep. Rufus Rodriguez had raised the government’s reported P1.5-billion obligation to Toyota Motor Philippines Corp.
In response, DTI Undersecretary Ceferino Rodolfo said the department had secured funding to settle the automotive program arrears and that payment was already being processed.
Roque said the funding came from savings from the Department of Public Works and Highways’ 2025 budget, rather than a separate allocation in the proposed 2027 National Expenditure Program (NEP).
‘It’s a savings from the 2025 budget of DPWH,’ Roque said, adding that such savings are typically used to pay incentives owed under the automotive program so participating companies can continue investing in the Philippines.
Under CARS, parts manufacturers are also part of the incentive structure, with participating automakers required to source components from small and medium-sized enterprises to qualify for the incentives.
With the arrears being addressed, Roque said the government can proceed with the RACE program, which is intended to succeed the existing automotive incentive framework.
‘The RACE program. We’re just waiting for the final touches,’ she said.
Roque said the program could be launched within the next month.
Rodolfo earlier told lawmakers that RACE had been included in the DTI’s Tier 2 budget proposal submitted to the Department of Budget and Management, although it was not yet reflected in the 2027 NEP.
He also said the joint administrative order governing RACE was already being circulated among the agencies involved.
Further, Roque said the government’s shift toward electric vehicles would proceed separately, noting that President Ferdinand Marcos Jr. had already directed the government to pursue the sector.