By Bernie Cahiles-Magkilat

Toyota Motor Philippines (TMP) on Monday announced a ₱4.5-billion logistics hub to store its increasing volume of completely built up (CBU) imports amid threats by the Board of Investments (BOI) to slap safeguard duty on imported cars to encourage local production.

Outgoing TMP President Satoru Suzuki, who announced the new logistics hub project at the annual media thanksgiving yesterday, said the investment will house mainly all its imported vehicles. Its existing logistics facility in its manufacturing complex in Sta. Rosa, Laguna will continue to host locally-assembled vehicles that can hold 4,000 to 5,000 units, he said.

Suzuki explained they need efficient logistics so they need new and bigger logistics center because their existing facility will soon overflow. Details of the project are still confidential including location and capacity although they’ve been planning this project for 2 years now. Construction of the project will start next year and may be operational same year also.

The logistics hub comes at a time when the government plans to impose safeguard measure on imported cars to encourage car companies to assemble locally and protect the local industry and jobs generation.

According to Suzuki, the safeguard issue is something worrisome because it is anti-free trade. “We are worried,” he said.

“If you’re asking if it [safeguard measure] is good or bad, it is bad. It will cause damage,” he said.

Suzuki, however, said that if government decides to slap safeguard measure it will turn its logistics hub a waste because it will no longer be needed. This means, the safeguard measure would curtail its ability to import because Toyota vehicles would become expensive compared to other models not affected by the higher tariff.

But Suzuki said they have to proceed with the logistics hub project because they believe the BOI is just bluffing about it or not serious about imposing safeguard measure versus CBU imports.

Suzuki said the industry through the Chamber of Automotive Manufacturers of the Philippines, Inc. will discuss the safeguard issue with the BOI.

TMP Vice Chairman Alfred Ty also said the planned imposition of safeguard measure on imported cars particularly affecting Thailand and other Asian countries would only further “dampen” and counterproductive to the already challenging market conditions.

“It needs open discussion, lots of issues that needs to be put on the table will be out on the table. W cannot look at it face value because industry operates on CKD CBU combination basically the more sales the better it is for the operating companies and workers as long as tax paid vehicles. We have to we have to look at it as a whole,” he said.

“We should look at it and do the number, but as a whole, it will just dampen so we have to look at the number because the objective is to stimulate the numbers so not equate to that objective,” he added.

The industry is just recovering in the fourth quarter after slump sales. Hopefully, he said, TMP would post a single-digit growth for the entire 2019.

For next year, TMP is cautiously optimistic because of the continuing challenges like a lot of players in the market and the regional and global developments. “So, we are monitoring closely,” he said.