Mitsubishi to invest P4.3 billion in Philippine market
Mitsubishi Motor Cop., announced its intention to invest nearly P4.3 billion in order to commence its production of sedan and hatchback styles of Mirage model in Philippines. The company expects to start the production of these versions in early 2017.
The investment strategy highlights Mitsubishi's move to partake in the country's new $600 million CARS Program, RAPPLER said quoting CEO and Chairman of Mitsubishi, Osamu Masuko. The company will file a request to partake in the program, Osamu added.
Osamu said in a press briefing that the company will construct its sedan and hatchback versions at the Sta. Rosa Laguna facility, which it started in January 2015. Osamu added that the investment activity will boost the employment chances in the domestic sector. He expects the new investment strategy to create 700 jobs in the starting phase.
Osamu also noted that leaders of top 20 auto parts makers are determined to join the Philippine market. The addition of these auto parts suppliers will boost the growth of overall automobile sector in the nation and increase the employment chances to 3,000 fresh jobs.
The company decided to invest in Philippines because the country enjoys robust economic growth and increase in population. This investment move comes as the domestic automotive sector is experiencing rapid growth helped by robust sales.
In 2015, auto sales in the country increased by 23%, RAPPLER said citing a sales record from Chamber of Automotive Manufactures of the Philippines Inc., (CAMPI). Osamu also said that the ASEAN Economic Community will further boost the competition since it permits tariff less movement of cargoes.
The CAR Program is anticipated to lure over P27 billion in fresh investments, with an aim of designing nearly 600,000 vehicles and create 200,000 additional jobs, according to Inquirer.net. The program is anticipated to result in a net economic activity worth P300 billion. The gross domestic product was anticipated to be around 1.7%.
The company's local unit has fixed a sales goal of 67,800 parts in 2016 and predicts to achieve the goal following the launch of Mirage models in the CAR Program, according to BusinessWorld. Last year, Mitsubishi sold nearly 54,087 parts and this is considered to be a "record breaking performance" since the year 1996.
Henry Co, Governor of BOI, said that the nation, which had numerous hurdles in the past, is expected to have a prosperous future backed by its new government. The CAR Program summons non-fiscal and fiscal motivations to refresh Philippines' automotive sector. The program urges the participants to produce a minimum of 200,000 vehicles in the domestic region. The company aims to reach this goal by concentrating on small cars.
Mitsubishi's participation in the program will enable the company to develop its balance sheet in the local market. The investment activity will also help the company to withstand the global economic slowdown.