The CARS program is saved…by unused DPWH funds

Earlier this month, the Philippine government under President Ferdinand Marcos Jr. decided to veto funding for the Comprehensive Automotive Resurgence Strategy (CARS) and the Revitalizing the Automotive Industry for Competitiveness Enhancement (RACE) programs—two projects important for the local automotive industry—during the signing of the 2026 General Appropriations Act (GAA).

CARS was introduced during the late President Benigno Aquino III’s administration as a way to revitalize the local automotive industry, which was originally meant to produce 200,000 cars for six years but was extended thanks to the pandemic. Introduced last year, the RACE program is the follow-up to this, just with a smaller scope of around 100,000 units per manufacturer.

Companies such as Toyota Motor Philippines (TMP) and Mitsubishi Motors Philippines (MMPC) locally assemble cars such as the Tamaraw, Innova, and Vios; and the L300 and Mirage G4, respectively. Count in all the local auto parts manufacturers under the Philippine Parts Makers Association (PPMA), and you can see why the pulling of the Php 4.32-billion fiscal support for the CARS program can raise alarms.

For a while, the uncertainty on how these programs would be funded raised a lot of eyebrows and voices in the industry. But now, the Department of Budget and Management (DBM), the Department of Finance (DOF), and the Department of Trade and Industry (DTI) have found a way to fund the CARS program, coming from one of the most controversial agencies of last year—the Department of Public Works and Highways (DPWH).

In a nutshell, the declared and verified savings from the DPWH, alongside “existing budgetary items under the programmed appropriations of the FY 2025 GAA” are enough to support the dues for participating vehicle and auto part manufacturers in the country, even if the CARS program is not included for this year’s GAA.

However, the future of the RACE program is yet to be secured, as a source of funding has yet to be found, and the savings are only enough to cover the CARS program.

TMP, MMPC, and the Chamber of Automotive Manufacturers of the Philippines (CAMPI) all have issued their respective official statements of approval:

Toyota Motor Philippines Corporation (TMP) welcomes the Philippine government’s clarification on its fiscal means and reaffirmed commitment to honor its obligations under the Comprehensive Automotive Resurgence Strategy (CARS) Program. 

TMP sincerely appreciates the government’s decisive action to reassure investors and stakeholders who have long supported the Philippine automotive manufacturing industry. This move reinforces confidence in the country as a sustainable base for automotive manufacturing.

We remain committed to working closely with the government in revitalizing the Philippine automotive industry as a driver of nation-building.
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Mitsubishi Motors Philippines Corporation (MMPC) expresses its sincere gratitude to the Philippine government for securing funding for the Comprehensive Automotive Resurgence Strategy (CARS) Program incentives. This demonstrates clear commitment to the local automotive industry and reinforces confidence in the sector’s stability and long-term prospects.

We are grateful to Finance Secretary Frederick Go for leading this initiative and to the Department of Budget and Management, Department of Finance and the Department of Trade and Industry and other government agencies for their coordination in ensuring the program’s commitments are fulfilled.

MMPC remains dedicated to delivering quality vehicles to our valued customers and stakeholders. We will continue to maintain a responsible presence in the Philippines, supporting communities, contributing to economic growth, and upholding our role in the country’s long-term development.

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The Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) welcomes the announcement of a funding solution for the Comprehensive Automotive Resurgence Strategy (CARS) Program incentives. We thank the concerned agencies – the Department of Trade and Industry, Board of Investments, Department of Budget and Management, and the Department of Finance, for their prompt action to resolve the issue on CARS incentive funding.

This gives renewed confidence in our industrial policy and puts the automotive sector back on track for long-term investment planning. CAMPI and its members look forward to the implementation of the Revitalizing the Automotive Industry for Competitiveness Enhancement (RACE) Program, which will be instrumental in industry recovery and growth.

CAMPI will continue to work with the Government and our auto-supporting industries in coming up with programs and policies to sustain automotive manufacturing in the Philippines.

^{Photos from Toyota Motor Philippines and Sam Surla}