The government has moved to steady investor confidence in the automotive sector, assuring participants in the Comprehensive Automotive Resurgence Strategy (CARS) program that long-promised incentives will be honored despite last year’s budget setback.
Finance Secretary Frederick Go said in a January 16 press briefing that a funding solution for the CARS program has been finalized, easing concerns triggered by its defunding in 2026. While Go did not disclose specific details, he stressed that the government remains committed to its obligations.
“Those enrolled in the program can now be assured that the government will fulfill its commitment to investors,” Go said, referring to Toyota Motor Philippines Corp. (TMP) and Mitsubishi Motors Philippines Corp. (MMPC), the program’s two participants.
The assurance comes after uncertainty rippled through the industry when the President vetoed the CARS budget this year, effectively halting the release of incentives that were central to the program’s investment pitch. The move raised questions about policy consistency and the reliability of long-term industrial support.
Based on the latest publicly available figures, government obligations to the two automakers amount to nearly P4 billion. This does not yet include TMP’s pending Production Volume Incentive application worth P1.557 billion, which remains under evaluation.
Industry sources also estimate that MMPC has around P1 billion in collectibles under the program’s Fixed Investment Support component, tied to capital expenditures made in line with CARS requirements.
Launched to revive local vehicle manufacturing, the CARS program offers fiscal support to companies that commit to large-scale production and localization. Toyota and Mitsubishi have invested heavily in assembly plants, parts sourcing, and supplier development, banking on the stability of the incentive framework.
With the funding issue now resolved, the government hopes to reinforce credibility with existing investors—while signaling to potential entrants that flagship industrial programs will survive political and budgetary turbulence.
