Gov’t assures auto industry of legal, timely CARS payments

The Department of Budget and Management (DBM), Department of Trade and Industry (DTI), and Department of Finance (DOF) have issued a joint clarification to address concerns and misinformation surrounding the Comprehensive Automotive Resurgence Strategy (CARS) Program following its exclusion from the FY2026 General Appropriations Act (GAA).

The agencies emphasized that the exclusion does not signal a withdrawal of government support for the auto industry. Validated obligations under the CARS Program will continue to be settled in an orderly and fiscally responsible manner, using available budget items in the FY2025 GAA.

Under the FY2025 national budget, two key appropriations remain available: funding for the Project Management Office of the CARS Program and the Fiscal Support Arrearages for the program. Although the arrearages line item was not included in the FY2026 GAA, the government retains the authority to augment this allocation using declared and verified savings from the Department of Public Works and Highways, subject to presidential approval and applicable fiscal laws.

“The government’s position is clear: we will not abandon the auto industry. Obligations supported by issued and validated TPCs will be paid in a legal, orderly, and responsible manner, consistent with our fiscal space and established budgetary rules,” said DBM Secretary Rolly U. Toledo.

According to the agencies, validated Tax Payment Certificates (TPCs) already issued provide a basis for paying participating manufacturers such as Toyota and Mitsubishi, along with qualified local autoparts makers. The necessary funds will be sourced from FY2025 savings, pending approval by the Office of the President.

For remaining claims not yet covered by TPCs or the current GAA, the government is considering their inclusion in the proposed FY2027 National Expenditure Program (NEP). These would then undergo cash programming in line with available fiscal space to ensure a phased and responsible settlement.

Secretary Toledo also noted that fund releases must adhere to legal requirements and sound fiscal strategy to preserve public trust and business confidence.

DTI Secretary Cristina A. Roque reaffirmed the government’s commitment to industry collaboration, saying, “The government recognizes the automotive industry’s vital role in job creation, technology development, and industrial growth. We are committed to ensuring that the incentives under the CARS Program continue to encourage investors to do business in the Philippines.”

Finance Secretary Frederick D. Go echoed the administration’s policy to honor investment commitments made under the program.

“President Ferdinand R. Marcos, Jr. has given clear direction that the government must honor the commitments it made to investors who placed their trust in the Philippines. The CARS Program is a key pillar of our strategy to strengthen local manufacturing, and we will ensure that legitimate obligations are paid—consistent with the law and within the capacity of public funds,” said Go.

“Our message to the auto industry is clear: do not worry—you remain part of the government’s long-term plan for industrial development, jobs creation, and economic growth,” he added.

The DTI is continuing to validate remaining TPC claims to ensure completeness, accuracy, and compliance with program rules before any additional disbursements are made.

The DBM, DTI, and DOF jointly underscored their openness to dialogue and commitment to lawful, prudent solutions that support industrial growth while safeguarding the public interest.

“We will ensure that the government maintains a clear and responsible course in settling obligations and supporting the auto industry, always in accordance with the law and the capacity of public funds,” Secretary Toledo concluded.