Commuter vans could be PH’s niche vehicle – NPI

The Philippines could have targeted the van segment as a niche motor vehicle product that it can incentivize for local production because of the growing demand for commuter vans, which could replace the old and dilapidated jeepneys, an automotive industry leader said.

Antonio Zara, President and Managing Director of Nissan Philippines, Inc. (NPI), said the country’s automotive program should not compete directly against similar vehicle models in other countries.

“Instead of competing head on against other ASEAN car producers, we should target for a niche product that we should incentivize,” Zara said.

He said that the most appropriate vehicle is something that has a greater potential for domestic use. This could be a van model because there is a growing demand for an efficient transport system.

Zara noted that when the Euro4 standard is implemented it will definitely hit the jeepneys, the most common form of transportation in the country but are mostly using second-hand engines. The Euro4 is going to take effect in January 2017.

“When the jeepneys are phased out because it cannot comply with the Euro4 emissions standard, what is the form of mass transport that can replace them?” he asked. The most practical model could be Euro4 compliant vans.

Zara noted that other countries in ASEAN are already producing small cars like Indonesia and Malaysia. Thailand is concentrating on its one-ton pick-up truck and it is now producing ecocars.

“We should not compete head on because they have already taken those niche markets. The van is the most practical,” he said.

The vans market in the country is placed between 20,000 to 30,000 units of which the URVAN model of Nissan contributes 5,000 units. Toyota Motors Philippines is a segment leader because it has 3 models, including Hi-Ace and Grandia.

Demand for vans will grow outside of Manila with the implementation of Euro4.

“We should develop that by protecting that segment with incentives,” he said.

According to Zara, he was part of the consultation during the crafting of a special automotive program. But he was surprised when the program dubbed “Comprehensive Automotive Resurgence Strategy” or CARS came out. The CARS Program grants $600 million in tax incentives to 3 car models that are produced locally. Each car model participant must achieve a production volume of 200,000 units over a 6-year period.

Zara said they don’t have plans to assemble locally stressing it is cheaper to import completely built up packs. The only CKD model of NPI is Almera, its sedan car model.