Nissan may expand business in Philippines

SINGAPORE -- Japanese automaker Nissan may expand its operations in the Philippines through its Filipino partner after President Gloria Macapagal-Arroyo assured the company's chief of continued government support for the auto industry.

On top of this, Nissan is also interested in the assembly of light vans with high local content level in the Philippines.

These developments came to light after President Arroyo met with Nissan and Renault president and CEO Carlos Ghosn at the two-day World Economic Forum in this island state.

They were joined by the president of the Chamber of Automotive Manufacturers of the Philippines Inc (CAMPI), Elizabeth Lee, who is also senior vice president of Universal Motors Corp., the Philippine partner of Nissan.

"There is a possibility of expansion [of Nissan's operations] in the Philippines," she told reporters after the meeting, but explained that the plan was still at an early stage.

Lee said, however, that her company would expand and strengthen its assembly operations for completely knocked-down (CKD) auto units in response to strong auto sales, brought about by the resurgent economy.

"We're experiencing the highest growth [in auto] sales right now," she said. "Things are looking up."

Amid the bullish outlook for local auto sales, Lee said CAMPI continued to seek government’s support for Philippine assemblers and parts manufacturers.

In particular, she said low-cost parts manufacturers in the Philippines needed more funding support from the government for them to improve their operations.

"Basically, we need incentives," she said.

With government support, Lee said, Philippine manufacturers would be able to supply more automotive parts to assemblers overseas or to vehicle makers in the Philippines.

"Their quality is up to par," she said. "They just need more support."

CAMPI is holding discussions with the government for possible tax incentives to lower the cost of vehicles, allow members to expand their markets and improve their profitability.