Move to liberalize truck parts importation bucked

The Chamber of Automotive Manufacturers of the Philippines (CAMPI) cautions the Arroyo government that further liberalization of the importation of used trucks and buses would delay the recovery and expansion of the local automotive industry.

In a letter to Trade and Industry Secretary Manuel Roxas II, Vicente Mills, president of CAMPI, relayed the local automotive manufacturers’ objection to the government’s further liberalization of importation of used trucks and buses weighing below six tons up to 4.5 tons.

According to Mills, "the industry is deeply concerned by this reported shift in policy direction in view of your previous pronouncements that government intends to clamp down on importation of used motor vehicles by imposing a wide ranging ban, with the exception of special purpose vehicles."

Mills’ letter stressed that "with this new policy shift, the viability of this segment of the industry will be put in great peril as these imports strike at the heart of the commercial vehicle segment."

The specific segment to be affected would be the Commercial Vehicle Development Program (CVDP) Category I, II and III which represents the biggest market volume, and which according to Mills is "even larger than the passenger car segment."

Mills pointed out that since there is only one tariff line for trucks under HS Code No. 87-04, "such liberalization is susceptible to circumvention as has been happening to the 10-seater passenger vans."

It has been argued that the classification issue is further exacerbated by the varying definitions of trucks depending on the objectives of the implementing government agencies concerned.

CAMPI, Mills said, believes that the proposed policy shift would adversely affect the CBU (completely built-up) export program of the assemblers which is supposedly being encouraged by the Arroyo administration. CAMPI, Mills said, is "strongly recommending that the current policy on used trucks and bus imports be maintained."

The current policy, according to Mills is that trucks with gross vehicle weight above six tons and buses with gross vehicle weight above 12 tons and special purpose vehicles (SPVs), regardless of gross vehicle weight, are liberalized.

SPVs are those classified by the Current Import Commodity Classification Department (CCICCD) of the Bangko Sentral ng Pilipinas (BSP) such as: truck-tractors; cement-bulk-carriers/transit mixers; LPG carriers; fire trucks; fabricated trucks for logging, mining and the like; truck mounted cranes; crane trucks; crane lorries; compactor; and other SPVs or similar vehicles that are subject to LTO registration.

Under the current policies on used trucks and bus imports, "the user groups that traditionally buy used vehicles have been adequately supplied. There are no shortages of such vehicles.

"Apart from impacting local production, broadening the scope of liberalization of used vehicles imports would only make more difficult the faster implementation of the Clean Air Act, improvements in traffic and road safety and the upgrading of the nation’s commercial vehicle fleet for the transport of people, goods and services," Mills concluded.