PPMA CARS RACE Program Veto Puts Philippines Auto Manufacturing at Risk

On January 7, 2026, the PPMA CARS RACE Program became the center of a growing industry crisis after the Philippine Parts Makers Association warned that the President’s decision to veto funding could severely weaken the country’s already fragile vehicle manufacturing base. The move has raised serious concerns over the survival of domestic car assembly.
The association explained that declining production volumes are placing extreme pressure on local auto parts suppliers, many of whom depend on vehicle assembly plants to sustain their operations. With imports of fully built vehicles rising rapidly, suppliers are being forced to cut back production, shift to unrelated industries, or focus on exports to remain viable.
How the PPMA CARS RACE Program Supports Local Manufacturing
The PPMA CARS RACE Program was designed to restore production scale, attract supplier investment, and stabilize the local automotive value chain. Without this support, the domestic industry risks losing its foundation, including:

• Component manufacturing capacity

• Tooling and engineering capabilities

• Skilled automotive workforce

• Technology development and local know-how

The loss of these elements would weaken the country’s long-term competitiveness in vehicle manufacturing.
Why the PPMA CARS RACE Program Matters for Industry Growth
According to the association, the Philippines has already demonstrated that it can succeed in vehicle manufacturing. Local assembly volumes reached their peak during the 1990s, proving that the country can support large-scale production when policy and investment conditions are right.
The PPMA CARS RACE Program was introduced to revive that momentum by extending manufacturing to new vehicle categories and emerging automotive technologies, while also creating a stronger demand base for domestic suppliers.
Rising Imports Threaten the Domestic Automotive Ecosystem
PPMA warned that continued reliance on imported fully built vehicles could dismantle the broader automotive ecosystem. This would not only impact parts manufacturers, but also affect engineering services, logistics providers, and industrial skill development linked to vehicle production.
The association stressed that losing local assembly would have long-term economic consequences, reducing industrial depth and limiting the country’s ability to participate in future automotive technology shifts.
Lawmakers Urged to Reconsider PPMA CARS RACE Program Funding
PPMA is now calling on lawmakers to reopen discussions on restoring funding for the PPMA CARS RACE Program, warning that without stable and sustained policy support, the Philippines risks becoming heavily dependent on imports and losing the opportunity to build a competitive domestic automotive manufacturing base that can support growth, jobs, and technological advancement.