Used-vehicle importers are laughing their way to the bank

HARDTOP By Vernon B. Sarne

FURIOUS leaders of the local car industry—including Elizabeth Lee, president of the Chamber of Automotive Manufacturers of the Philippines Inc.; George Blaylock, president of the Philippine Automotive Association; and Egmidio Jose, president of the Motor Vehicle Parts Manufacturers Association of the Philippines Inc.—faced the press last week.   They had every right to be furious, considering the kind of documents they had in their possession. First is a September 8 memorandum to the President from Chief Presidential Legal Counsel Maria Merceditas Gutierrez, informing the former that “the Department of Finance, the Department of Trade and Industry, the Bureau of Customs, the Subic Bay Metropolitan Authority, and the Land Transportation Office have been directed by Executive Secretary Eduardo Ermita to comply with the Regional Trial Court decision as affirmed by the Court of Appeals, allowing the importation and entry of used motor vehicles within the Subic Special Economic Zone, subject only to the payment of the required customs duties, until final disposition of the matter by the Supreme Court.”   The second document is the more disturbing one, containing an inventory of a certain batch of used vehicles imported from February 2 to April 15 last year. The spreadsheet—a portion of which is shown in the table below—includes the vehicles’ make and model, model year, selling price, acquisition cost by the importers, actual paid taxes and the estimated profits raked in by these importers.   I shrugged off the contents of the first document, but credit must go to Senator Dick Gordon for leaking it out. After all, what’s new? Our government has the knack for contradicting itself and an even greater knack for giving existing laws self-serving interpretations. I mean, there exists Republic Act 8506 that bans the importation of right-hand-drive vehicles in the country—how simpler and more specific can you get? That used-vehicle importers are still able to wrestle with the issue in some obscure court in Pampanga, is way beyond my simple mind.   If you ever need solid proof that things are ridiculously out of order in this country, look no further. The issue involving imported used vehicles should have been the President’s showcase a long time ago that her administration has, first, integrity and, second, political will. If a simple case of used-vehicle importation cannot be resolved until now, why should we be optimistic about the resolution of deeper, more important issues that plague our country today?   On second thought, used-vehicle importation is not really a simple case, as shown by the table below. Any business that can churn out a product that makes a P300,000 profit from a P50,000 investment, is sure to thrive. And its owners will move heaven and earth to ensure that it continue to do so. Unfortunately, heaven and Malacañang are often confused for each other in this country.   Look at the table carefully and you’ll understand why used-vehicle importation has lingered—and prospered—in a country with a serious, legitimate car industry that is already struggling mightily against those of Thailand, Malaysia and Indonesia. The smallness of our new-car market has already shooed investors away, and our government is just all too happy to sit down, file its nails and whistle while looking the other way. Could many of our public officials be on the take? Um, is Toyota Japanese?   No wonder the treatment of the issue has been a joke. Used-vehicle importers are mocking Philippine laws and laughing their way to the bank in the process. They’ve laid low in Subic but simply moved elsewhere—in Cagayan de Oro. It’s so frustrating, it’s enough to make self-respecting Filipinos cry.   Even so, I believe the acquisition of the second document—the one with the breakdown of how much used-vehicle importers make—is a significant victory for the car industry. There was never a doubt in my mind before that these people were earning gazillions of money by dumping motorized junks in our laps, but I never saw a black-and-white proof. That is exactly the problem in this country: We all know who is doing what; we just can’t prove it. The document should now make the public think twice about buying imported used vehicles.   Let’s not argue about the subject of right-hand-drive configurations. Let’s not explain here how these vehicles—already nearing their end of life—are actually more of a liability than asset. Let’s not point out the safety and environmental hazards these converted vehicles pose. Let’s not even dwell on the car industry’s 77,000-strong workforce whose jobs are on the line every time legitimate car sales get anemic.   Let’s just hold a magnifying glass over the table below and ask ourselves if we’re still willing to make a few individuals filthy rich at the expense of our sinking auto industry and, more importantly, our moribund nation. Shame on you if you couldn’t care less.

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