According to industry sources, top officials of Honda Motors Co. Ltd. of Japan have met and informed Trade and Industry Secretary Manuel Roxas II of their intention to increase their investment in the Philippines.
Sources said Honda intends to build a new plant to manufacture transmission systems under a plan that seeks to increase its export earnings by $100 million.
The Honda officials reportedly assured Roxas that the Japanese car firm is "very much committed to the Philippines" and that it is not running away from the country in spite of the economic slump.
While the Honda officials committed further investments in the country, they did not specify how much they would be bringing in.
Honda has already invested over P1 billion on its existing assembly plant in Laguna.
Sources said Honda ’s additional investment would be part of its plan to avail itself of the ASEAN industrial Cooperation (AICO) scheme.
Under the AICO scheme, participating countries would be able to manufacture different complementary products in different countries and export and import them as needed.
Honda would benefit from preferential tariff rates under the AICO scheme which ranges from zero to five percent.
Honda already has an existing AICO arrangement with Thailand for body parts, Malaysia for plastic parts and Indonesia for engine blocks. It sources its transmission parts from Japan.
Honda Cars Phils., Inc. ranks No. 1 in terms of passenger car sales in the country, while its ranks No. 3 in terms of total industry sales.
HCPI’s bestsellers in the country are its Civic car model and its sports utility vehicle, the CRV.