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Auto parts workers seek aid package amid industry slowdown

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WORKERS from the auto parts industry have asked the government to allocate part of the auto incentives program budget to fund social amelioration initiatives for displaced workers, and opposed the industry’s request for an extension to comply with the program.

Toyota Motors Philippines and Mitsubishi Motors Philippines Corp. members of the government’s Comprehensive Automotive Resurgence Strategy (CARS) program, which offers fiscal support to car companies that domestically produce 200,000 cars for six years.

The automakers have initiated talks with the government to request an extension of their compliance period after the pandemic and the Taal volcano eruption caused a sales and production slowdown.

The Philippine Metalworkers Alliance (PMA) opposed the extension, claiming in a statement Monday that relief for the automakers would incentivize them to lay off workers and rely on imports rather than expand domestic production.

“While the economy is currently in a crisis, this alone should not be the basis for granting reprieve to companies under the CARS program,” PMA President Ruel Punzalan said.

“Unless the government wants to subsidize job losses especially under the current economic crisis, then there is no point giving in to the pressure from corporate interests to extend the grace period under the CARS program,” the statement said.

The group said that while there was a sales decline during the stricter lockdown, there have been signs of automotive recovery due to an uptick in transport equipment sales.

“To start repairing the injustice, allocating a portion of the budget for the CARS Program to provide social amelioration to those already displaced would be a good start,” Mr. Punzalan said.

Trade Secretary Ramon M. Lopez in a briefing Monday said that the job losses are connected to the recent industry decline.

He said that the social amelioration program can be proposed to the government and discussed, adding that the economy is being reopened to help increase car demand among the program’s participants.

PMA in August wrote letters to the Labor and Trade departments, asking them to strengthen the automotive supply chain and continue an investigation into potential safeguard measures on imported vehicles.

Last year, the group filed an application to the Trade department to initiate a safeguard measures probe, saying that there is a link between a surge in imports and a decline in domestic employment.

BusinessWorld asked the Chamber of Automotive Manufacturers of the Philippines, Inc. for comment but it had not replied at deadline time. — Jenina P. Ibañez

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