October 23, 2017, 3:42 pm
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Jeep modernization rolls out in ’18

The government will finalize before the end of the year the Public Utility Vehicle (PUV) program and roll it out by the middle of 2018,  according to Ramon Lopez, secretary of the Department of Trade and Industry (DTI).

In an interview on the sidelines of the 1st Philippine Auto Parts Expo at the Philippine Trade Training Center yesterday, Lopez said DTI may limit to three to five players the number of participants of the program to achieve economies of scale and hit the desired 200,000 units of new PUVs in five to six years.

Ferdinand Raquelsantos, Philippine Parts Manufacturers Association, said 150 units of the eco PUVs will be deployed in selected areas before the end of the year, increasing it to 300 by the first quarter of 2018.

Raquelsantos said by July next year, the date when the program is eyed for implementation, the industry should have assembled 500 units.

Lopez also said the government will grant incentives per unit to the body builder participants of the program, in the amount   that could be lower or higher than the $1,000 per unit incentive given to Vios and Mirage, the model entries in the Comprehensive Automotive Resurgence Strategy (CARS, see related story on this page). This way, PUVs will be more affordable.

Martin Delgra, chairman of the Land Transportation Franchising & Regulatory Board (LTFRB), said the government will also grant a subsidy for the acquisition cost of as much as P80,000 per unit of vehicle to be sold to jeepney operators and cooperatives formed from the consolidation of single-unit jeepney owners.

Lopez said the platform (engine and chassis) providers will not be entitled to incentives. 

The DTI shifted the unsubscribed third slot budget under CARS to support the local manufacturing of replacement vehicles for the PUV modernization, such that the incentives would thus be limited to locally-assembled PUVs.

“The market volume requirement of over 200,000 replacement PUV units presents an opportunity to jumpstart the development of the country’s commercial vehicle sector,” Lopez said. 

Beyond the PUV requirements, Lopez said the government 
can also move into the local manufacture of Special Purpose Vehicles (or SPVs) that the Philippines is currently importing heavily, like ambulances, truck-mounted cranes, and mini-firetrucks.

According to Lopez, the Board of Investments (BOI) is still clarifying the criteria for the incentives for the PUV program but that the participants should have track record and capability in bodybuilding.

“The body builders will be entitled to incentives (similar to the) CARS participants -- similar principle, but we’re not saying it’s a similar amount. That is part of the details we’re finalizing... the principle is per unit ,” said Lopez.

About 16   prototypes went on display at the expo yesterday featuring body builders Almazora Motors Corp., Centro Manufacturing Corp., Del Monte Motors, Hino Motors  Philippines Corp., Sta. Rosa Motor Works Inc. as well as platform suppliers Foton Motor Philippines, MMPC-Fuso (Diamond Motors Corp.), Hino, Hyundai Philippines, ICC Ichigan Inc., Isuzu Philippines Corp., Philippine Utility Vehicle Inc and Pilpinas Tax Autogroup Inc. (Tata).

But according to Lopez while the specifications for the four classes of PUVs have been approved by the Bureau of Product Standards, the design is yet to be approved. Each would, however, its own look of the modern jeepney, that is safe and environment-friendly.

“The design is not  yet final but the based on the prototypes designs, the vehicle will have a side door entrance, is a lot bigger and  more comfortable which is a lot different from the jeepney . The jeepney we could keep some  for heritage and nostaligia… but the regular experience (of commuting through PUVs) should be more modern,” Lopez said. 

 He also assured the jeepney drivers will be better off  if they convert to new jeeps in terms of earnings.

“We are coming up with schemes to make transformation lighter and more acceptable,” he said, adding that there will be less maintenance cost and more revenues for the drivers.

Delgra  for his part said with the assistance of the Department of Finance and of the government financial institutions, a financial package where the drivers only  5 percent in equity and 6 percent interest rate for the financing. 

Payment terms is seven years, which the LTFRB which is about the life of a vehicle and the terms of the franchise. (I.Isip)
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