Heavy gov't regulation hurting PH auto industry: AVID

Posted at 07/30/2014 9:09 PM

MANILA – The Association of Vehicle Importers and Distributors (AVID) on Thursday said the regulation of the automotive industry has affected efforts to boost local production.

"We have to reduce dependence on government support. We always tend to rely on government as a lifeline. We need government support in terms of infrastructure and regulations for a better business environment,” said AVID president Fe Perez-Agudo.

“We have always been under protectionism through price ceiling, non-regulation of the number of automotive players, heavy government regulation... this is why the industry never grew and discouraged investors to come in," she added.

Agudo urged the government and the automotive sector to rethink the automotive roadmap and synchronize it with the ASEAN Economic Community in time for the integration in 2015.

She noted that the AVID has been calling for a shift from traditional incentives to new incentives geared towards innovators to help the industry become competitive in the global market.

"When you give the automotive companies incentives, there should be clear cut conditions or parameters to make sure that only deserving companies get incentives. Incentives should be strictly monitored and guided by performance management system that uses well-defined matrix," she said.

AVID is also calling for government to focus on supporting the development of the parts and components sector to make the auto industry more competitive and sustainable.

According to Agudo, government should also implement a competition policy "because we believe that it will foster and nurture more efficient markets and will advance consumer welfare."

"Why do we want competition policy? Because we want a level playing field that put the consumer first because a competitive market will definitely generate more and better quality products and choices and lower prices for our consumers," she said.