Big business awaits local small-auto parts makers

LOCAL manufacturers of small-automobile spare parts may grab the lion’s share of the business to be generated under the Asean-Australia-New Zealand Free-Trade Area (AANZFTA).

Trade Senior Undersecretary Thomas G. Aquino said the government expects these local auto-parts makers to corner more business with Australian-based vehicle manufacturers, especially for the smaller types of automobiles, and are in the position to become the biggest winners among all sectors under AANZFTA.

Aquino said Australian small auto firms have already made known their interest to get from the Philippines their requirements for spare parts.

A trade mission of Australian auto manufacturers is now being formed to follow up on a similar visit of a delegation from the Motor Vehicle Parts Manufacturers Association of the Philippines to Australia last year.

Australia has a huge automotive market of about 1 million annually, with about 33 percent of the total units sold made by its manufacturers, Aquino said.

Australia is buying more from Thailand than the Philippines, he said, but that this can change soon under the AANZFTA.

Australian firms that do certification services of auto parts and designs can now also set up operations in the Philippines.

“If they [Australians] certify them, those parts and components will be allowed to enter Australia, and even elsewhere,” Aquino told reporters.

He said Australian manufacturers are more focused on the bigger types of vehicles so there should be no competition with the Philippine-based makers that are concentrated on producing components for small models.

Aquino said auto parts, copper wires and cables are seen as the big winners for the Philippines in the AANZFTA.

Assistant Trade Secretary Ramon Kabigting said Phelps Dodge Philippines, for instance, is now expecting $1 million in sales from Australia annually.

Nito Seiki, Kabigting said, has also received numerous orders for its specialized car parts. The company will be increasing its employment by 25 percent this year and then double its current plant capacity in two years to meet the demand from Australia.

Local makers of lead acid batteries and tires will also benefit from the AANZFTA, Kabigting said. –Max V. de Leon / Reporter, Businessmirror