The Society of Honor by Joe America

Comments

1. Irineo B. R. Salazar says:

   April 13, 2026 at 9:36 am

   thanks Karl. Just linking the documents Joey shared with us for context – and also to track interest. Our statistics show that they already been downloaded at least 5 times from the comments where I initially shared them, let’s see if this “teaser” gets more interested. Your article does give the major aspects of Joey’s plan which I shall break down into more detail in my April 26 article. Joey please feel free to correct any misconceptions or add explanations if our understanding has not been complete:

   1. Utilize foreign car manufacturers as drivers (pun intended) to build local suppliers. Have a kind of import substitution rule that forces them to have more local suppliers each year to get subsidies

   2. Utilize PUV modernization to subsidize the consumer side. That is genius, as even over here in Germany electric cars are still often seen as “rich man’s playthings” only slowly for the middle class, much less for the blue collar service industries that often drive around in diesel vehicles.

   3. Utilize the fact that the Philippines already has ONE Tier 1 supplier, IMI from Ayala. Tier 1 means a lot as they have the zero defect standard. Anyone who has done software projects knows that is HIGH!

   4. Utilize the Philippine supply of nickel to help build a battery making industry. Value added!

   5. Utilize the existing corporations, channelize their profit motive. For instance mandate that Petron build charging stations. The rest I can’t quite remember as of now.

   6. Create a strong regulatory body to make sure everyone takes part. I might insist on giving that body the right to override TROs but don’t know how that works over there. And a boss a la Vince Dizon.

   7. Create a certification institute to make sure parts don’t have to be certified abroad. If there are trust issues, I might involve TÜV Rheinland, already working in the Philippines to help build it.

   8. subsidize electric power for the industry as the Philippines has expensive electricity.

   9. Joey has several EOs and 5 laws in his kumpletos rekados package linked below. The challenge would be how to get them passed quickly, without dilution and simultaneously. Karl you know that stuff..

   Click to access 1.-asean6_automotive_investment_report_2021_2025.pdf

   Click to access 2.-ph_automotive_industrial_policy_analysis.pdf

   Click to access 3.-ph_conglomerates_automotive_sector.pdf

   Click to access 4.-ph_automotive_5yr_10yr_blueprint.pdf

   Click to access 5.-neda_memo_2026_auto_001.pdf

   Click to access 6.-ph_auto_legislation_impact_analysis.pdf

   Click to access 7.-paselp_draft_bills.pdf

   Click to access 8.-ph_auto_public_communications.pdf

   

   Reply
   • Karl Garcia says:

     April 13, 2026 at 9:48 am

     Thanks again, Irineo

     Reply
     • Irineo B. R. Salazar says:

       April 15, 2026 at 8:00 pm

       I asked Claude to juxtapose PH industrial policy analysis versus PH auto legislation impact analysis and it came up with this:

       —

       **1. Absent Binding EV Production Offset Mechanism**

       Document 1 identifies this as the *single most impactful structural gap*. EVIDA provides zero-tariff import access but creates no legal obligation for Chinese (or any other) OEMs to manufacture locally. BYD reached 69% of the Philippine BEV market purely through imports without any manufacturing commitment, because unlike Thailand’s EV 3.0/3.5 framework, no binding 1:2 production offset obligation exists in Philippine law.

       Document 2’s solution is the **EV Manufacturing Investment Act**, which combined with a Presidential EO on production offsets, creates the binding mechanism that converts import privilege into factory commitment — explicitly modelled on the Thai mechanism that triggered BYD’s Thailand factory decision.

       —

       **2. CARS Program Structural Limitations**

       Document 1 details four specific failures: the program is ICE-era only with no BEV track; its 200,000-unit minimum threshold excludes most EV and commercial vehicle candidates; its funding depends on annual Congressional appropriation (the very instability that triggered the 2025–2026 investor confidence crisis); and it has no local content escalator to drive supply chain development.

       Document 2’s solution is the **CARS Program Amendment Bill**, which lowers the production threshold to 50,000 units over five years, adds a BEV-specific incentive track, shifts funding from annual appropriation to BOI tax expenditure (eliminating reappropriation risk), and adds EV categories. The shift to tax expenditure is particularly directly responsive — it is the structural fix Document 1 identifies as the most important single reform.

       —

       **3. High Industrial Power Costs**

       Document 1 quantifies the problem precisely: Philippine industrial power at USD 0.18–0.22/kWh is roughly double Thailand (USD 0.08–0.10) and Vietnam (USD 0.07–0.09). For a 50,000-unit stamping and assembly plant, this translates to USD 8–12 million in additional annual operating cost versus Thai competitors — a figure explicitly cited by Japanese OEMs in site selection assessments. Document 1 notes that fundamental parity requires multi-year electricity market reform, making it among the hardest barriers to close quickly.

       Document 2’s solution is the **Industrial Power Cost Act**, mandating the ERC to establish a Special Automotive Manufacturing Rate targeting USD 0.11–0.13/kWh, with AboitizPower’s RE:INVEST programme providing 4,600 MW of dedicated renewable capacity as an interim mechanism. Document 2 acknowledges this doesn’t fully close the gap with Thailand but treats it as sufficient to remove power cost as a disqualifying barrier.

       —

       **4. Absence of an Automotive Testing and Certification Centre**

       Document 1 notes that Thailand has ATTRIC, Indonesia has BPPT, Malaysia has MIROS, and Vietnam has RQCD — all providing in-country type approval and certification. The Philippines has nothing equivalent, requiring OEMs to conduct certification testing offshore at additional cost, time, and logistical friction that is explicitly cited in site selection assessments.

       Document 2’s solution is the **Automotive Testing and Certification Centre Act**, mandating the establishment of the PATCC in CALABARZON modelled on ATTRIC, with type approval capability for E2W, E3W, and commercial EVs. It also proposes JICA ODA funding for PATCC construction as a direct Japanese national interest, given that Toyota and Isuzu would be primary beneficiaries.

       —

       **5. Thin Domestic Supplier Ecosystem**

       Document 1 presents the stark comparison: fewer than 80 meaningful automotive-grade parts manufacturers in the Philippines versus 2,500+ in Thailand and 600+ in Indonesia’s Cikarang corridor alone. For Japanese OEMs using keiretsu supply chain management — where preferred Tier 1 suppliers follow the OEM into host countries only if a Tier 2/3 base already exists — this is a near-disqualifying gap. It also notes that without a binding production offset obligation, OEMs have no commercial incentive to invest in developing local suppliers.

       Document 2 addresses this through two mechanisms working in tandem: the **local content incentive scheme** (additional CIT reduction for achieving 40% Philippine-sourced content) provides a sustained commercial incentive for OEMs to develop suppliers; and the proposed PHP 10–15 billion **Automotive Supply Chain Development Fund** provides matching grants to Philippine SME manufacturers seeking Tier 1/2 qualification. Document 2 projects 450–700 new Philippine companies created by 2030 and 890–1,430 by 2035 across the full supply chain — though it honestly acknowledges the multiplier effects will be below ASEAN averages in early years precisely because the ecosystem starts thin.

       —

       **6. Absence of Green Public Transport Demand Stimulus**

       Document 1 identifies the e-jeepney and e-trike segments as uniquely Philippine entry points with no ASEAN equivalent, but notes that the binding constraint is operator financing — modern e-jeepney units cost PHP 2.5–3.5 million versus PHP 800,000–1,200,000 for old-model jeepneys, making the economics impossible for operators without concessional finance. The PUVMP mandate exists but the capital mechanism to execute it does not.

       Document 2’s solution is the **Green Public Transport Fund Act**, capitalising PHP 30 billion through DBP at 3–5% concessional lending rates with PhilGuarantee credit backing. This directly addresses the financing gap Document 1 identifies as the binding constraint, while simultaneously creating the government fleet demand signal that Document 2 argues is the precise trigger needed to justify a Hyundai commercial vehicle manufacturing commitment.

       —

       **7. Absence of G2G Industrial Diplomacy Architecture**

       Document 1 notes that Hyundai’s Indonesian factory was anchored by a state-level Korea-Indonesia government partnership with sovereign guarantee elements — a G2G architecture the Philippines has never deployed with any automotive OEM. It also notes that BYD’s Thailand commitment was catalysed by a policy mechanism (production offset) rather than market size alone, and that the Philippines has no equivalent diplomatic or policy lever currently engaged with any of the three major OEM investor cohorts.

       Document 2 addresses this through the international partnerships framework in Section 6, mapping specific G2G diplomatic actions for each cohort: a Presidential bilateral with Toyota for ASEAN BEV hub designation; KEXIM-facilitated engagement with Hyundai tied to GPTF fleet demand; and the production offset EO as the legal mechanism to convert BYD’s existing 69% import market share into a manufacturing conversation. These are less legislative solutions than diplomatic ones, but Document 2 explicitly frames the legislation as the credibility instrument that makes G2G diplomacy credible — a country with binding legislative commitments is a fundamentally different negotiating partner than one with aspirational policy statements.

       —

       **The one gap Document 2 doesn’t fully close**

       Document 1 is notably candid that industrial power cost parity with Thailand and Vietnam requires fundamental EPIRA reform and transmission infrastructure investment that is a multi-year undertaking. Document 2’s Industrial Power Cost Act is a real solution but an incomplete one — it targets USD 0.11–0.13/kWh, which closes roughly half the gap with Thailand but still leaves Philippine industrial power meaningfully more expensive. This is the one area where the solution Document 2 offers is explicitly partial, and it’s worth noting for anyone assessing the legislative package’s completeness.

       Reply
       • Irineo B. R. Salazar says:

         April 15, 2026 at 8:06 pm

         Claude says this about ASEAN automotive employment in the same chat as the two documents:

         The documents give varying levels of detail by country. Here’s what can be extracted:

         —

         **Thailand**

         This is the most complete figure in the documents. Document 1 states that Thailand’s automotive ecosystem supports **850,000 direct employees and 700,000 indirect employees**, for a total of approximately **1.55 million**. Document 2 adds further context, citing Thailand at mature development as employing **850,000 direct + 1.5 million indirect = 2.35 million total**, on a production base of 1.8 million vehicles per year. The slight discrepancy between the two figures likely reflects different reference years, with Document 2’s 2.35 million figure representing a more complete induced employment count on top of the indirect figure.

         —

         **Philippines**

         Both documents give figures for the Philippines, split between the current baseline and the projected programme outcomes.

         The **current baseline** (import/distribution model, no manufacturing programme) is approximately **220,000** employed in dealerships, aftersales, parts distribution, and transport — with no significant direct manufacturing component.

         Under the **PASELP manufacturing programme**, Document 2 projects:
         – By 2030: **85,000 direct**, 200,000 indirect supply chain, 160,000 induced consumer spending, 30,000 automotive retail and aftersales, 6,000 government and institutional — **totalling approximately 481,000**
         – By 2035: **120,000 direct**, 280,000 indirect, 240,000 induced, 60,000 retail/aftersales, 10,000 government — **totalling approximately 710,000**

         —

         **Indonesia, Malaysia, and Vietnam**

         This is where the documents are notably thin. Neither document provides a consolidated employment figure for any of these three countries equivalent to the Thailand figure. What can be inferred is fragmentary:

         – **Indonesia**: Document 1 references Indonesia’s EV investment heavily and notes total EV ecosystem investment of USD 42 billion from 2020–2023, and EV car sales of 43,188 units in 2024, but gives no total automotive employment figure.
         – **Malaysia**: Document 1 discusses Perodua, Proton, and the NIMP 2030 framework in some depth but gives no employment totals. The only quantitative labour market reference is Perodua’s 358,000 units sold in 2024.
         – **Vietnam**: Document 1 covers VinFast and THACO extensively, noting VinFast delivered 87,000 vehicles in Vietnam in 2024, but again provides no employment aggregate.

         —

         **The honest answer** is that the documents were written with a specific Philippine policy advocacy purpose, and the comparative ASEAN employment data was included selectively. Thailand is cited in full because it is the benchmark the Philippines aspires to and the calibration reference for the Philippine employment projections. Indonesia, Malaysia, and Vietnam are analysed primarily for their *policy architecture* rather than their *employment outcomes*, so their workforce numbers simply weren’t included.

         For complete employment figures for those three countries you would need to go to their respective industry associations — GAIKINDO (Indonesia), MAA (Malaysia), and VAMA (Vietnam) — or to ILO or ADB regional manufacturing labour surveys, which are cited in Document 2’s source list but not quoted directly.

         Reply
       • Irineo B. R. Salazar says:

         April 15, 2026 at 8:09 pm

         Now I asked Claude to add the 5-10 year automotive blueprint to the mix and this came out:

         This is the fourth and final report in the series — the implementation blueprint that converts the diagnosis (Document 1) and the economic justification (Document 2) into a concrete, sequenced, actor-specific action plan. Here’s a summary and how it relates to the earlier two documents.

         —

         **What Document 3 is**

         Where Document 1 asked “what’s broken?” and Document 2 asked “what do we gain by fixing it?”, Document 3 answers “who does what, with whose money, in what order, and what happens if we don’t?” It operates at a level of operational specificity the other two documents don’t attempt — naming specific conglomerates, specific funding amounts, specific technology partners, specific year-by-year milestones, and specific geopolitical risk scenarios.

         —

         **The Five Implementation Paths**

         The blueprint organises action around five parallel paths rather than a single sequential strategy:

         **Path A (GT Capital / Toyota)** converts the existing Toyota Motor Philippines CARS ICE operation at Santa Rosa, Laguna into a BEV manufacturing commitment built around the Toyota bZ-series. It targets 8,000–12,000 units in the first year of commercial production (2028), scaling to 30,000+ by 2030, with the goal of making the Philippines Toyota’s third ASEAN BEV assembly hub alongside Thailand and Indonesia. Funded primarily through TMP retained earnings and DBP project finance at PHP 8–12 billion.

         **Path B (Ayala / IMI)** doesn’t require Ayala to become a vehicle OEM at all. Instead it activates IMI’s existing globally-certified Tier 1 automotive electronics capability as the anchor of a Philippine EV electronics supply chain cluster, targeting USD 450–500 million in EV-related revenue by 2030 and positioning the Philippines as ASEAN’s primary EV charger electronics manufacturer. This path carries the lowest risk of any of the five and the fastest capital return.

         **Path C (San Miguel Corporation)** uses SMC’s unique asset base — Petron’s nationwide fuel station network, MRT-7 operations, and manufacturing capability — to build the Philippines’ electric commercial vehicle and public transport electrification industry. It targets 14,000 electric commercial vehicles per year by 2030 (buses, e-jeepneys, delivery vans), with Petron converting to a 5,000-station EV charging network and the e-jeepney potentially becoming ASEAN’s first exported electric public transit vehicle type.

         **Paths D1–D3** are the structural enablers all three primary paths depend on: AboitizPower reducing industrial power costs to PHP 6.00–6.50/kWh through dedicated RE supply to automotive zones (directly addressing the most persistent barrier from Document 1); Meralco building out 3,000+ public fast-chargers to support EV adoption; and JG Summit Petrochemicals developing automotive-grade PP/PE polymer supply to anchor the domestic plastics parts supply chain.

         —

         **Funding Architecture**

         Document 3 makes an important argument that neither of the earlier documents develops as fully: the Philippines doesn’t need foreign capital to fund this programme. It maps PHP 85–125 billion in private conglomerate equity and self-funded capex across GT Capital, Ayala, SMC, Aboitiz, Metro Pacific, and JG Summit, alongside PHP 95–150 billion in GFI lending capacity from DBP, Land Bank, PhilEXIM, and PhilGuarantee, with SSS and GSIS pension funds as a long-tenor bond capital source. Government fiscal exposure is estimated at only 25–30% of total programme investment — with the rest covered by conglomerate balance sheets and GFI lending that is expected to perform at commercial quality given OEM anchor tenant credit quality.

         —

         **Technology Transfer Sequencing**

         Document 3 provides the most strategically sophisticated section of the entire series on this point. It explicitly sequences technology partnerships by geopolitical risk, lowest to highest:

         Phase 1 (2026–2027) covers Toyota CKD BEV and Yadea/NIU E2W — virtually zero geopolitical risk, proceeding immediately under existing bilateral frameworks. Phase 2 (2027–2029) adds Hyundai e-bus and Chery E2W/E3W — low risk, covered by the Korea-Philippines FTA. Phase 3 (2029–2031) addresses BYD and CATL — medium risk, managed through Singapore SPV structures and the existing PH-China Joint Committee diplomatic channel. The sequencing logic is explicit: build industrial capability with low-risk partners first, then use that capability as leverage to negotiate the more complex Chinese technology relationships from a position of strength.

         —

         **The Three Scenarios**

         Document 3 presents three 2035 convergence scenarios that bring the earlier documents’ projections into sharp relief. The base case — ASEAN EV Niche Hub — targets 80,000–100,000 vehicles per year, 45,000–60,000 direct jobs, and USD 1.5–2.5 billion in annual export value, with the Philippines as ASEAN’s fourth automotive manufacturing economy with a distinctive EV specialism. The optimistic case targets 150,000+ vehicles, 80,000 direct jobs, and a Philippines-branded electric tricycle exported to eight markets. The no-action scenario is the starkest: 90%+ import dependency by 2035, possible TMP closure, automotive sector shrinking to below 0.6% of GDP, and permanent exclusion from ASEAN supply chain diplomacy.

         —

         **The Geopolitical Dimension**

         This is ground neither of the earlier documents covered in depth. Document 3 directly addresses whether the Philippines’ deepening US-Japan security alignment makes Chinese automotive investment politically untenable. Its answer is no — and it uses Vietnam as the proof of concept: Vietnam has the deepest Chinese supply chain integration in ASEAN outside Singapore while simultaneously maintaining strong US and Japan security partnerships. The recommended framing is Malaysia’s dual-track model: Chinese EV manufacturing is a commercial matter; the South China Sea is a legal matter; the two are not conditional on each other. The BYD engagement is specifically recommended to proceed through the PH-China Joint Committee rather than direct OEM negotiation, providing political cover while maintaining commercial momentum.

         —

         **How it relates to Documents 1 and 2**

         The relationship between the three documents is one of progressive resolution. Document 1 identified seven structural barriers — absent production offset, weak CARS program, high power costs, thin supplier ecosystem, no testing centre, infrastructure gaps, and no G2G automotive diplomacy. Document 2 named the five pieces of legislation that address those barriers and quantified what passage would yield. Document 3 now answers the question those two documents left open: even with the legislation passed, who actually builds the factories, where does the money come from, whose technology do they use, and in what order does it all happen?

         The most important connective tissue is the power cost problem. Document 1 called it a near-disqualifying barrier. Document 2’s Industrial Power Cost Act acknowledged it was only a partial solution. Document 3 finally closes the loop by making AboitizPower’s RE:INVEST programme the operational mechanism — with a specific PHP 6.00–6.50/kWh target delivered to automotive zone tenants by 2028 through dedicated RE wheeling arrangements, backed by IFC and JBIC green energy financing.

         Similarly, Document 1’s observation that the supplier ecosystem gap requires 5–10 years and OEM commitment to close is answered in Document 3 by the Supply Chain Density Programme targeting 200 new Tier 2–3 automotive-grade supplier certifications by 2030, using Indonesia’s BKPM Astra Otoparts programme as a template compressed from seven years to five through co-funded IATF 16949 certification.

         The one genuinely new argument Document 3 adds that neither predecessor makes explicitly is the sovereignty argument: a Philippines that manufactures nothing is not geopolitically neutral — it is strategically vulnerable. The semiconductor supply chain crisis of 2020–2022 is invoked as the direct precedent. Manufacturing capability, the report argues, is strategic capability, and the cost of permanent import dependence by 2035 is not merely economic — it is a permanent foreclosure of the Philippines’ ability to participate in the supply chain diplomacy that will define ASEAN’s economic architecture through 2040.

         Reply
         • Joey Nguyen says:

           April 16, 2026 at 2:13 am

           Claude is very impressive and is on a different level than ChatGPT. Very to-the-point without the addition of empathetic tricks.

           Reply
           • Irineo B. R. Salazar says:

             April 16, 2026 at 12:03 pm

             I asked Claude to summarize the 3 documents I processed yesterday and got this:

             The Philippines faces a decisive moment in its economic development. Despite a domestic automotive market growing at 8.5 percent annually — reaching 475,000 vehicles in 2024 and projected toward one million by 2033 — over 80 percent of those vehicles are imported, costing the country an estimated USD 4.5–5.5 billion in annual foreign exchange outflows. This makes the Philippines a stark outlier among its ASEAN peers. Thailand has built a 2.35-million-employment automotive sector over four decades of consistent industrial policy. Indonesia leveraged its vast nickel reserves to attract USD 42 billion in EV ecosystem investment. Malaysia created domestic OEM champions in Proton and Perodua. Vietnam attracted conglomerate-scale capital to build VinFast and now exports vehicles regionally. The Philippines, by contrast, has fewer than 80 meaningful automotive-grade parts manufacturers, industrial power costs double those of Thailand and Vietnam, no automotive testing and certification centre, and no binding legal mechanism requiring EV importers to manufacture locally. If this trajectory continues unchanged, import dependency reaches 90 percent by 2035 and the Philippines becomes permanently locked out of the manufacturing order that will define ASEAN’s economic architecture through 2040.

             The economic case for acting is unambiguous and grounded in regional precedent. A coordinated legislative package — covering CARS program reform, EV manufacturing investment incentives, green public transport financing, industrial power cost reduction, and an automotive testing centre — is projected to generate USD 3.5–5.0 billion in annual current account improvement by 2035, PHP 85–130 billion in incremental government tax revenues per year, and add 0.8–1.1 percentage points to annual GDP growth. The government’s fiscal position turns net positive by Year 5–6, with a fiscal multiplier of 4.2–6.8 times — meaning every peso of government incentive expenditure returns PHP 4.20–6.80 in incremental tax revenues over ten years. These figures are not speculative; they are calibrated against the demonstrated outcomes of comparable BOI incentive programmes in Thailand and Indonesia. The cost of inaction is estimated at USD 30–50 billion in lost cumulative GDP contribution and 400,000–600,000 jobs not created over the coming decade. The risk of building is significantly smaller than the risk of not building.

             The employment and wage effects are equally compelling. The programme is projected to generate 85,000 direct manufacturing jobs and approximately 481,000 total jobs — direct, indirect, and induced — by 2030, growing to 120,000 direct and 710,000 total by 2035. These are permanent manufacturing positions paying 1.7 to 5.8 times the Philippine national average salary depending on skill level, concentrated in CALABARZON where underemployment currently runs at 12–14 percent, and carrying full social security and health benefit coverage. The automotive employment multiplier of 5–7 times additionally activates steel, rubber, plastics, electronics, chemicals, and logistics industries whose independent development would otherwise require separate industrial programmes. The total annual wage bill from direct automotive manufacturing alone reaches PHP 64.8 billion by 2035 — income spent predominantly in host communities, generating consumer market development that compounds the programme’s economic impact well beyond the factory gates.

             The implementation pathway is concrete, actor-specific, and financially executable without excessive dependence on foreign capital. GT Capital’s existing Toyota franchise is converted from ICE assembly into BEV manufacturing built around the Toyota bZ-series, targeting 30,000 units annually by 2030 and designation as Toyota’s third ASEAN BEV hub. Ayala’s IMI — already a globally certified Tier 1 automotive electronics manufacturer — becomes the anchor of a Philippine EV electronics supply chain cluster targeting USD 450–500 million in EV-related revenue. San Miguel Corporation deploys its Petron network, MRT-7 operations, and manufacturing capability to build the Philippines’ electric commercial vehicle industry, including the e-jeepney as ASEAN’s first exported electric public transit vehicle. AboitizPower closes the industrial power cost gap through dedicated renewable energy supply to automotive manufacturing zones. The combined private conglomerate capital commitment is PHP 85–125 billion, supplemented by PHP 95–150 billion in government financial institution lending — with net government fiscal exposure limited to approximately 25–30 percent of total programme investment, substantially offset by GFI interest income. The Philippines does not need to beg for foreign industrial capital. It needs to mobilise the capital it already has.

             The geopolitical context supports rather than complicates this decision. The Philippines’ deepening security alignment with the United States, Japan, and South Korea is a direct FDI asset: Toyota, Isuzu, Hyundai, and Kia all have both the commercial interest and the political incentive to deepen Philippine manufacturing investment as supply chain diversification away from China-adjacent ASEAN locations. Chinese EV investment — from BYD, Chery, and CATL — can proceed simultaneously on strictly commercial terms through appropriate structures, following Vietnam’s proven model of combining deep Chinese supply chain integration with strong US and Japanese security partnerships. Technology partnerships are sequenced by geopolitical risk: Toyota and Yadea electric two-wheeler technology first, Hyundai and Chery second, BYD and CATL third via Singapore holding structures and existing diplomatic channels. Most critically, remaining a pure consumer is not a neutral position — it is strategic vulnerability by another name. A Philippines that manufactures nothing can be economically coerced by any supplier country that restricts exports, as the global semiconductor crisis of 2020–2022 demonstrated with devastating clarity. The 2026–2030 window in which the ASEAN EV manufacturing map remains open to Philippine entry is closing. The decision the Philippines makes now — to build or to remain a buyer — will define its manufacturing identity, its fiscal trajectory, and its geopolitical leverage for the next generation.

             then I asked to mesh that with the ASEAN investment report and the conglomerates paper and got this:

             —

             ## The Philippines at the Automotive Crossroads: A Synthesized Summary

             ### The Problem in Plain Terms

             The Philippines is the outlier of ASEAN automotive development — a growing market that manufactures almost nothing it sells. Vehicle sales reached 475,000 units in 2024, projected toward one million by 2033, yet over 80 percent are imported, draining an estimated USD 4.5–5.5 billion in foreign exchange annually. The ASEAN-6 investment data makes the contrast stark: over 2021–2025, Thailand attracted USD 13.7 billion in automotive investment, Indonesia USD 13.9 billion, Vietnam USD 9.3 billion — and the Philippines just USD 2.2 billion, the second-lowest after Singapore, which deliberately has no automotive manufacturing sector. If nothing changes, import dependency reaches 90 percent by 2035 and the Philippines is locked out of the manufacturing order defining ASEAN’s economic architecture through 2040.

             —

             ### What the Rest of ASEAN Did — and How

             The investment report provides the empirical foundation for why the Philippines’ situation is not inevitable.

             **Thailand** built its dominance through four decades of consistent policy, culminating in the EV 3.0 and EV 3.5 incentive packages — which combined consumer subsidies with binding local production offset requirements at 1:2 and 1:3 ratios. This directly catalysed a Chinese manufacturing cluster in Rayong that now has prospective capacity of 600,000 BEVs per year. BYD opened its first overseas factory there in July 2024. SAIC, Great Wall, Changan, Chery, and GAC Aion all followed. Japanese OEMs — Toyota, Honda, Isuzu, Mitsubishi — responded with a joint THB 150 billion EV conversion pledge, though Honda simultaneously closed one Thai factory and Suzuki closed its sole Thai plant, signalling the difficulty of maintaining ICE-era scale.

             **Indonesia** leveraged its nickel reserves to attract USD 42 billion in EV ecosystem investment, including Hyundai’s wholly-owned USD 1.55 billion HMMI factory in Cikarang — the first large-scale domestically assembled EV in ASEAN — and a USD 6 billion CATL-Indonesia Battery Corporation battery ecosystem. The domestic anchor is PT Astra International, whose USD 20.7 billion revenue conglomerate provides Toyota with political navigation, a 6,000+ dealer network, financial services integration, and a Tier 1 parts group (Astra Otoparts), in exchange for technology, tooling, and brand access over 50+ years.

             **Malaysia** created Proton and Perodua through state policy, then rescued Proton from near-insolvency through Geely’s 49.9 percent acquisition — a cumulative USD 10 billion transformation that produced the e.MAS 7, Malaysia’s first domestically made EV, in December 2024. Perodua independently developed its own EV, the QV-E, in 2025.

             **Vietnam** is the most instructive case for the Philippines. VinFast — backed by Vingroup, Vietnam’s largest conglomerate — built a 300,000-unit Hai Phong factory from rice paddies in 21 months for USD 1.5 billion, delivered 87,000 vehicles in 2024 (18 percent domestic market share), and has entered the Philippine, Indonesian, Thai, US, and European markets. THACO, Vietnam’s largest seller by volume, evolved from licensed Kia and Mazda assembly in 1997 to its own truck and bus brands and 1,200 vehicle exports in 2024. Hyundai’s joint venture with Thanh Cong made Vietnam-manufactured Hyundai Palisades the first passenger cars ever exported from Vietnam to Thailand in October 2024 — qualifying for zero-tariff ASEAN free trade access.

             The common thread across all four is unambiguous: **automotive manufacturing investment follows policy clarity**. Not labour cost alone. Not market size alone. Policy architecture — binding, credible, multi-year, and tied to local content escalation — is the determinative variable.

             —

             ### Chinese Investment: The Defining Trend

             Across ASEAN-6, Chinese automotive investment totalled approximately USD 13.7 billion over 2021–2025, exceeding Japanese investment (USD 11.7 billion) for the first time. In Thailand, 85 percent of EV sales in 2024 were Chinese-made. In Indonesia, Chinese EVs accounted for two-thirds of EV sales. BYD surpassed Toyota as Singapore’s top-selling brand in 2024.

             In the Philippines, Chinese investment remains at roughly USD 170 million over five years — almost entirely in distribution, not manufacturing. This is simultaneously a vulnerability (risk of EV import flooding from Chinese-assembled ASEAN factories) and an opportunity: the Philippines has not yet been passed over by Chinese OEMs seeking a manufacturing foothold. That window is narrowing as Thailand’s capacity fills and Indonesia’s commitments execute.

             —

             ### What the Philippines Has — But Isn’t Using

             The conglomerates report makes the most counterintuitive finding of the three documents: **the capital gap is not the problem**. Philippine conglomerates collectively hold more than sufficient financial resources. The gap is in policy architecture and corporate commitment.

             **GT Capital / Ty Family** — the Philippines’ only large conglomerate with deep automotive involvement — holds 51 percent of Toyota Motor Philippines (TMP), which posted PHP 220 billion in full-year revenues in 2024. TMP’s CARS Program enrollment (Vios/Yaris production at Santa Rosa, Laguna) and the PHP 5.5 billion Tamaraw IMV-0 CKD commitment show willingness to manufacture. The critical next step, identified as the single most determinative action in Philippine automotive policy for 2026, is converting this into a BEV production track for Toyota’s bZ series — targeting 30,000–50,000 units annually and positioning the Philippines as Toyota’s third ASEAN BEV hub.

             **Ayala Corporation / IMI** — through Integrated Micro-Electronics Inc. (2024 revenue USD 1.26 billion), Ayala is already the Philippines’ largest producer of automotive electronics by value, supplying Tier 1 global customers including BorgWarner, Flex, and Jabil. IMI’s capability in automotive power electronics, battery management systems, EV motor controllers, and ADAS sensor assemblies is directly applicable to EV supply chain development. This asset is described as “the most underappreciated strategic asset” in the Philippine economy. The recommended role is anchor supplier for a Philippine EV Electronics Supply Chain Hub, leveraging existing international vendor certifications as the pathway into Japanese, Korean, and Chinese OEM supply chains.

             **San Miguel Corporation** — the Philippines’ largest company by revenue at PHP 1.6 trillion — owns Petron (approximately 2,600 fuel stations nationwide), operates MRT-7, manages NAIA, and runs toll roads carrying over one million vehicles per day. None of this infrastructure is currently directed toward EV. The recommended pivot: Petron as the backbone of a national EV fast-charging network; MRT-7 maintenance facilities as the base for electric bus manufacturing; and SMC’s infrastructure footprint as the anchor for the Philippines’ electric commercial vehicle industry. The pasted brief envisions San Miguel building the e-jeepney as ASEAN’s first exported electric public transit vehicle.

             **AboitizPower** is the mechanism to close the industrial power cost gap — Philippine industrial electricity at USD 0.18–0.22/kWh is roughly double Thailand and Vietnam, creating a structural USD 8–12 million annual operating cost premium per 50,000-unit plant. AboitizPower’s RE:INVEST programme (targeting 4,600 MW of additional renewable energy by 2030) already includes dedicated industrial power supply agreements with PEZA zone tenants below grid-weighted average rates — exactly the mechanism needed for automotive manufacturing zones without requiring full legislative amendment.

             —

             ### The Financial Logic

             The policy brief makes the fiscal case quantitatively. A coordinated legislative package — CARS reform, EV manufacturing incentives, green public transport financing, industrial power cost reduction, and an automotive testing centre — is projected to generate:

             – **USD 3.5–5.0 billion** in annual current account improvement by 2035
             – **PHP 85–130 billion** in incremental annual government tax revenues
             – **0.8–1.1 percentage points** added to annual GDP growth
             – **85,000 direct manufacturing jobs and 481,000 total jobs** by 2030, growing to 120,000 direct and 710,000 total by 2035
             – A **fiscal multiplier of 4.2–6.8x** — every peso of government incentive expenditure returns PHP 4.20–6.80 in incremental tax revenues over ten years
             – **Government fiscal position turns net positive by Year 5–6**

             The cost of inaction: USD 30–50 billion in lost cumulative GDP contribution and 400,000–600,000 jobs not created over the next decade.

             Private capital committed under the proposed programme (GT Capital, Ayala, San Miguel, AboitizPower): PHP 85–125 billion. Government financial institution lending: PHP 95–150 billion. Net government fiscal exposure: approximately 25–30 percent of total investment, substantially offset by GFI interest income.

             —

             ### The Structural Barriers — and Why They Are Surmountable

             The conglomerates report is clear-eyed about why Philippine conglomerates have not moved: banking, real estate, and telecoms consistently deliver 15–20 percent ROE; GT Capital’s Toyota franchise delivers 8–10 percent ROE. Without a structural policy intervention improving automotive manufacturing returns, the opportunity cost calculation does not favour factory investment. Philippine conglomerates have also shifted post-COVID toward asset-light, high-margin service businesses — structurally incompatible with the 10–15 year payback periods of automotive manufacturing without government risk-sharing.

             Beyond capital returns: fewer than 80 automotive-grade parts manufacturers (versus Thailand’s 2,500+), industrial power costs double Thailand and Vietnam, no automotive testing and certification centre, no binding local content escalator comparable to Thailand’s EV 3.0/3.5 regime, and CARS Program funding instability (the PHP 4.32 billion appropriation was vetoed in the 2026 budget, only partially repaired by a Presidential January 2026 commitment) that has left residual hesitancy among potential investors.

             None of these barriers is permanent. All of them are policy variables.

             —

             ### The Window — and What Closes It

             The ASEAN-6 investment data establishes the timeline. Chinese OEM factory construction in ASEAN peaked between 2022 and 2024. Thailand’s BOI has approved capacity approaching 600,000 BEVs per year from Chinese OEMs alone. Indonesia’s BYD and CATL commitments are executing. Vietnam’s Chery-Geleximco USD 800 million factory is under construction. The Philippines faces a **24–36 month window** in which it can still offer a distinctive value proposition — a manufacturing base not yet occupied — before the regional EV map consolidates.

             The geopolitical context supports the decision. The Philippines’ deepening security alignment with the United States, Japan, and South Korea is a direct FDI asset: Toyota, Isuzu, Hyundai, and Kia have both commercial interest and political incentive to deepen Philippine manufacturing as supply chain diversification away from China-adjacent ASEAN locations. Chinese EV investment can proceed simultaneously on commercial terms, following Vietnam’s proven model of combining deep Chinese supply chain integration with strong US and Japanese security partnerships.

             Remaining a pure consumer is not a neutral position — the global semiconductor crisis of 2020–2022 demonstrated with clarity what economic coercion looks like for a country that manufactures nothing strategic. The decision the Philippines makes in 2026–2027 will define its manufacturing identity, fiscal trajectory, and geopolitical leverage for the next generation.

             —

             ### The Bottom Line

             Three documents, one conclusion: the Philippines has the market, the conglomerate capital, the workforce, the strategic location, and the ASEAN trade access. What it lacks — and what is entirely within the government’s power to provide — is the binding industrial policy architecture that converts latent capacity into committed investment. Every country that built an automotive sector in ASEAN did so because a government constructed that architecture, credibly and durably, as an integrated framework rather than aspirational guidelines subject to annual budget politics. The Marcos administration’s window to do the same is open now, and narrowing.

             Yes, Claude is indeed a powerful tool. Of course I will read this and then write again in my own words but this does help a lot in understanding.

             Reply
             • Irineo B. R. Salazar says:

               April 17, 2026 at 2:54 am

               OK, asked for 12 para summary of all that and it reads COMPELLING (even if I will at the end print out the exec summary I get, read it, read the 8 documents (which I will print out too on the weekend, old school as I am) then make my own write-up.. oh if write-up is a Pinoy English term so be it:

               ## The Philippines at the Automotive Crossroads: 12-Paragraph Summary

               The Philippines is growing its automotive market at 8.5 percent annually — reaching 475,000 vehicles in 2024 and projected toward one million by 2033 — yet manufactures fewer than 20 percent of the vehicles it sells. Over 80 percent are imported, costing the country USD 4.5–5.5 billion in annual foreign exchange outflows. Across 2021–2025, the Philippines attracted just USD 2.2 billion in automotive investment against Thailand’s USD 13.7 billion and Indonesia’s USD 13.9 billion. If this trajectory continues, import dependency reaches 90 percent by 2035 and the Philippines is permanently locked out of the manufacturing order defining ASEAN’s economic architecture through 2040.

               The regional comparison is damning but instructive. Thailand built a 2.35-million-employment automotive sector through four decades of consistent industrial policy, culminating in EV incentive packages that catalysed a Chinese manufacturing cluster now capable of 600,000 BEVs per year. Indonesia leveraged its nickel reserves to attract USD 42 billion in EV ecosystem investment, including Hyundai’s USD 1.55 billion wholly-owned factory — the first large-scale domestically assembled EV in ASEAN. Malaysia rescued its near-insolvent national carmaker Proton through a USD 10 billion Geely partnership that produced Malaysia’s first domestically made EV in December 2024. Vietnam built VinFast from rice paddies in 21 months, delivered 87,000 vehicles in 2024, and now exports cars regionally. Every one of these outcomes was triggered by a binding, credible government policy framework — not by market forces alone.

               Chinese investment is the defining trend of the period. Across ASEAN-6, Chinese automotive investment totalled approximately USD 13.7 billion over 2021–2025 — exceeding Japanese investment for the first time. BYD opened its first overseas factory in Thailand in July 2024. In Thailand, 85 percent of EV sales in 2024 were Chinese-made; in Indonesia, two-thirds. In the Philippines, Chinese automotive investment over the entire five-year period amounted to roughly USD 170 million, almost entirely in distribution. This is simultaneously a vulnerability — the risk of EV import flooding from Chinese-assembled ASEAN factories — and a rapidly closing opportunity to attract first-mover Chinese manufacturing investment before competing ASEAN hubs are fully consolidated.

               Japanese OEMs, meanwhile, are in structured retreat from their ICE-era dominance while attempting EV conversion. Honda closed one of its two Thai factories in 2025; Suzuki closed its sole Thai plant; Nissan closed its Philippine plant in 2021. Against this, Toyota, Honda, Isuzu, and Mitsubishi jointly pledged USD 4.3 billion to electrify Thai production lines, and Toyota confirmed its first Southeast Asian EV production in Indonesia in July 2025. The critical variable is execution speed: Japanese EV conversion timelines remain two to four years behind Chinese first-mover advantage, threatening market share during the window when ASEAN consumers are forming EV brand preferences. For the Philippines, this creates an opening — Japanese OEMs with political incentives to diversify away from China-adjacent locations have commercial reasons to deepen Philippine manufacturing investment.

               The economic case for action is quantifiable and grounded in regional precedent. A coordinated legislative package covering CARS programme reform, EV manufacturing investment incentives, green public transport financing, industrial power cost reduction, and an automotive testing centre is projected to generate USD 3.5–5.0 billion in annual current account improvement by 2035, PHP 85–130 billion in incremental annual government tax revenues, and 0.8–1.1 percentage points of additional annual GDP growth. The fiscal multiplier is 4.2–6.8 times — every peso of government incentive expenditure returns PHP 4.20–6.80 in incremental tax revenues over ten years. The government’s fiscal position turns net positive by Year 5–6. The cost of inaction is estimated at USD 30–50 billion in lost cumulative GDP contribution and 400,000–600,000 jobs not created over the coming decade.

               The employment effects are equally compelling. The programme is projected to generate 85,000 direct manufacturing jobs and 481,000 total jobs by 2030, growing to 120,000 direct and 710,000 total by 2035. These are permanent manufacturing positions paying 1.7 to 5.8 times the Philippine national average salary, concentrated in CALABARZON where underemployment runs at 12–14 percent. The automotive employment multiplier of 5–7 times additionally activates steel, rubber, plastics, electronics, chemicals, and logistics industries whose independent development would otherwise require separate industrial programmes. The total annual wage bill from direct automotive manufacturing alone reaches PHP 64.8 billion by 2035.

               The most counterintuitive finding across the three documents is that the Philippines does not have a capital gap — it has a policy gap. Philippine conglomerates collectively hold more than sufficient resources to fund the required manufacturing commitments. The critical question is whether government policy is structured to make automotive manufacturing returns competitive with the 15–20 percent ROE these groups consistently earn from banking, real estate, and telecoms. GT Capital’s Toyota franchise delivers 8–10 percent ROE under current conditions. Without a structural intervention — tax holidays, production offset incentives, guaranteed government procurement — automotive capital deployment loses the internal competition for conglomerate balance sheets.

               Four conglomerates are identified as the delivery vehicles for the programme. GT Capital, through its 51 percent stake in Toyota Motor Philippines, is the incumbent anchor: the immediate priority is converting TMP’s existing CARS Programme enrollment into a BEV production track for the Toyota bZ series, targeting 30,000–50,000 units annually and designating the Philippines as Toyota’s third ASEAN BEV hub. Ayala Corporation, through Integrated Micro-Electronics Inc. — already a globally certified Tier 1 automotive electronics manufacturer with USD 1.26 billion in revenue supplying BorgWarner, Flex, and Jabil — is the anchor for an EV electronics supply chain cluster targeting USD 450–500 million in EV-related revenue. San Miguel Corporation, with its Petron network of approximately 2,600 stations, its MRT-7 operations, and its NAIA management role, is the natural vehicle for a national EV charging infrastructure and electric commercial vehicle manufacturing programme, including the e-jeepney positioned as ASEAN’s first exported electric public transit vehicle. AboitizPower, through its RE:INVEST renewable energy programme, closes the industrial power cost gap — Philippine industrial electricity at USD 0.18–0.22/kWh is roughly double Thailand and Vietnam, creating a structural cost premium that no BOI tax holiday can fully offset without dedicated renewable supply to manufacturing zones.

               The structural barriers facing these conglomerates are real but surmountable. The Philippines has fewer than 80 automotive-grade parts manufacturers versus Thailand’s 2,500-plus. It has no automotive testing and certification centre, no binding local content escalator comparable to Thailand’s EV 3.0/3.5 regime, and a CARS Programme whose funding was vetoed in the 2026 national budget — only partially repaired by a Presidential commitment in January 2026 to settle obligations from prior-year savings. This funding instability has created residual investor hesitancy that a binding multi-year legislative appropriation or tax-expenditure-based incentive framework — not subject to annual budget politics — is the only credible remedy for.

               The combined private conglomerate capital commitment for the programme is PHP 85–125 billion, supplemented by PHP 95–150 billion in government financial institution lending, with net government fiscal exposure limited to approximately 25–30 percent of total investment — substantially offset by GFI interest income. Technology partnerships are sequenced by geopolitical risk: Toyota and Yadea first, Hyundai and Chery second, BYD and CATL third through Singapore holding structures. The Philippines’ deepening security alignment with the United States, Japan, and South Korea is a direct FDI asset, giving Toyota, Isuzu, Hyundai, and Kia both commercial interest and political incentive to deepen Philippine manufacturing as supply chain diversification away from China-adjacent ASEAN locations.

               The window for this decision is defined and narrowing. Chinese OEM factory construction in ASEAN peaked between 2022 and 2024. Thailand’s approved BEV capacity from Chinese OEMs alone is approaching 600,000 units per year. Indonesia’s BYD and CATL commitments are executing. Vietnam’s Chery-Geleximco USD 800 million factory is under construction. The Philippines has a 24–36 month window in which it can still offer a distinctive, unoccupied value proposition to EV manufacturers seeking an ASEAN manufacturing base. That proposition requires deliberate, rapid construction — with binding government policy commitments, not aspirational guidelines.

               The ultimate argument is strategic, not merely economic. Remaining a pure consumer of imported vehicles is not a neutral position — it is strategic vulnerability. A Philippines that manufactures nothing can be economically coerced by any supplier country that restricts exports, as the global semiconductor crisis of 2020–2022 demonstrated. Every ASEAN country that built an automotive sector did so because its government constructed a binding, credible, integrated industrial policy framework and then sustained it across political cycles. The Marcos administration’s window to do the same is open in 2026–2027. The decision made in that window — to build or to remain a buyer — will define the Philippines’ manufacturing identity, fiscal trajectory, and geopolitical leverage for the next generation.

               this big picture came out when I asked Claude to add document 8:

               

               

               

               

               

               **The core argument runs as a single logical chain:**

               The Philippines has a fast-growing car market — 475,000 vehicles in 2024, heading toward one million by 2033 — but manufactures fewer than 20 percent of what it sells. Every other major ASEAN economy used a period of precisely this kind of market growth as the trigger for domestic manufacturing investment. The Philippines did not. The result is USD 4.5–5.5 billion leaving the country every year in import payments, and a widening gap in investment, employment, and industrial capability relative to Thailand, Indonesia, Malaysia, and Vietnam.

               The three documents together make the case that the problem is not intractable and not a question of money. Philippine conglomerates collectively hold more than enough capital. GT Capital, Ayala, San Miguel, and AboitizPower each have assets and operational positions that map directly onto the manufacturing, supply chain, infrastructure, and power requirements of an EV sector. The gap is that automotive manufacturing returns (8–10% ROE) cannot compete with banking or real estate (15–20% ROE) without a structural policy uplift — and every prior attempt at that uplift (the CARS Programme) was undermined by annual budget politics.

               The PASELP — the five-bill package transmitted to Congress on 28 March 2026 — is the government’s attempt to resolve that policy gap permanently. PAREA replaces CARS with a statute-backed framework that cannot be defunded by a budget veto. EVMIA makes Philippine incentives the most competitive in ASEAN for EV manufacturing. GPTEFA provides concessional financing for public transport electrification, creating domestic demand. IPCA caps industrial electricity costs, removing the single most persistent structural cost disadvantage. PATCCA builds the testing centre whose absence has been forcing OEMs to certify vehicles overseas.

               What makes the window genuinely finite is the ASEAN competitive dynamic. Thailand’s Chinese OEM cluster is approaching 600,000 BEV units per year of approved capacity. Indonesia’s battery ecosystem commitments are in execution. Vietnam’s Chery joint venture factory will be producing by 2026. The Philippines has perhaps 24 to 36 months in which it can still offer a distinctive, unoccupied manufacturing proposition — primarily to Japanese and Korean OEMs seeking supply chain diversification away from China-adjacent hubs, and to Chinese OEMs who have not yet placed all their ASEAN manufacturing bets.

               The presidential address and the public communications framing this as “Gumagawa na ang Pilipino” — the Filipino builds — is the political architecture designed to make the legislative package pass and to signal to OEM investment committees that this commitment will be sustained across political cycles. Whether that signal is credible is ultimately the question that every Toyota, Hyundai, and BYD investment committee will be evaluating in 2026 and 2027.

               Getting there..

               Reply
               • Joey Nguyen says:

                 April 17, 2026 at 5:44 pm

                 I speedread super fast but in future analysis I might include more graphics like you’ve made.

                 I’ve been thinking more about setting up these manufacturing verticals that bridge out to other verticals to sprout new industries. Sort of like how mangrove propagules grow out of and descend from the parent tree before establishing itself below. The parent and the child trees share nutrients and support each other.

                 Thinking in terms of “will this make money” is just too small minded for a planner in the government. It is the job of the business to think “will this make money” AFTER the business has reviewed the new environmental conditions changed by new laws. It is the job of the government to provide strategic vision and connect the various pieces together into something more like a mangrove forest. For an automotive industry is not only about “making cars,” but about steel, rubber, aluminum, glass, automotive electronics, and now, batteries and electric motors. Each child industry initially supporting but later spawning entirely new industries. The parents and children industries together are better equipped to weather economic shocks to their economic network as their roots work in unison like the mangrove.

                 Filipinos see BYD’s sleek BEVs and feel instantly discouraged, yet hardly few Filipinos care to know that BYD started off as a contract supplier of cheaper NiCad rechargeable batteries to Japanese companies that moved on to manufacturing more efficient NiMH and Li-ion batteries. Focusing on end results without learning the necessary steps. From BYD’s humble beginnings now BYD owns a good chunk of the global BEV market.

                 

                 Reply
                 • Irineo B. R. Salazar says:

                   April 17, 2026 at 6:08 pm

                   Those graphics are what Claude created when I asked for a big picture and summary, though I indeed like graphics when presenting stuff, trying to avoid the trap that SAP sometimes falls in to make the graphics look like the design of a BASF chemical plant.

                   I always saw the strength of the Catholic Church in its knowing how to use three communication lanes: the elite writings of the monks, the preachings of the priests and the Stations of the Cross for the visually inclined. Though I also know that a picture can be worth a thousand words, whether in a Gannt chart, a mindmap or a Kanban diagram – and am as one can see someone who likes both French Bandes Desinees, Japanese manga and the occasional Korean manhwa.

                   Companies use big picture diagrams a lot in trade fairs (Germany is trade fair country) where attention is a scarce commodity.

                   Reply
                   • Joey Nguyen says:

                     April 17, 2026 at 7:32 pm

                     Generally in communications it is important to convey information in a way that the audience can understand. Executives, strategic advisors, wonks, implementers, and those who are served by policy all need to be communicated with in different ways despite the information being the same. I guess white paper authors in the Philippines often like being wonks a bit too much, while it seems to me that a lot of Philippine leaders probably have no business being a leader when they are afraid of making any major decisions.

   • Joey Nguyen says:

     April 13, 2026 at 7:25 pm

     Utilize foreign car manufacturers as drivers (pun intended) to build local suppliers.

     Well I wouldn’t say that a foreign company would feel “used” if the business works out for the balance sheet. Having newer, cheaper suppliers is always a good business decision.

     Have a kind of import substitution rule that forces them to have more local suppliers each year to get subsidies

     I think generally, import-substitution is out of vogue, as is export-oriented. Those were old theories developed in the 1950s. Modern behavior is more of a hybridization between best practices (as expected). So a local content requirement as expressed in the proposed legislation as the production offset obligation operates along the lines of carrot-and-stick: a foreign investor may invest X amount of CKD kits and sell the assembled cars at reduced/zero-tariff, but by then the investor had already built an assembly facility, which is where additional incentives come in if the investor further invests in building a local supply chain. It isn’t as important that the local supply chain be “Filipino” owned as much as the local supply chain exists in the first place to provide jobs and constant technology transfer.

     Utilize PUV modernization to subsidize the consumer side.

     Yes, the goal of the legislation is to create an industry, a set of secondary supporting industries, where skills and technology can be applied to further industries in the future.

     Utilize the Philippine supply of nickel to help build a battery making industry. Value added!

     In addition to nickel, build a local rubber processing and rubber products industry. It makes no sense that Filipinos get paid a pittance for raw cup latex which is later processed and manufactured into end products like tires which can go into the automotive industry!

     Steel production is also anemic. The Philippines possesses all of the required steel inputs (iron, nickel, copper) in large amounts, yet local steel production is basically low-end products like construction rebar which is mostly made from recycled scrap as the Philippines doesn’t have what’s called a “fully integrated” steel mill after National Steel failed (1999) as a casualty of the Asian Financial Crisis. SteelAsia’s steel mills make rebar. Philippine lateritic iron has nickel as a secondary byproduct of iron ore processing, while volcanically formed Philippines has a lot of copper as well.

     giving that body the right to override TROs

     AFAIK only a higher court can override a lower court’s TRO. I can’t remember which case exactly but somewhere I read that the Supreme Court ruled that the Executive cannot override TROs, which makes sense since then a President and their subordinates can essentially rule by fiat. I understand that TROs are often misused in the Philippines, and am not sure how to fix that as it seems to be more of an issue with a politicized Judiciary. Possible workarounds are to ensure constitutionality of the laws to begin with, and having government lawyers aggressively work cases to prove such.

     subsidize electric power for the industry as the Philippines has expensive electricity.

     This is also a chance to create additional incentives for industrial electrical supply buildout, which unfortunately I didn’t address directly in my analysis. Perhaps pursuance of renewable battery-backed generation would be appropriate here to coincide with the charging station infrastructure proposed to be built by Aboilitz.

     The challenge would be how to get them passed quickly, without dilution and simultaneously.

     Marcos Jr. for whatever reason chose to use his pre-2025 Senate supermajority to pursue vanity projects (e.g. Maharlika). Whatever that reason Alyansa has a bare majority now. Here’s a real chance to work with the opposition liberal senators and unify against the Duterte threat. Which would give the BBM-Leni détente more reason to become a formal alliance going into the 2028 election. A pro-Philippines alliance with a visible plan and the beginnings of a record to run on against the anti-Philippines Dutertes and their cronies.

     Reply
     • Irineo B. R. Salazar says:

       April 13, 2026 at 8:04 pm

       Yes, the goal of the legislation is to create an industry, a set of secondary supporting industries, where skills and technology can be applied to further industries in the future.

       the meat of the article consists of two parts for me (after all the details of course)

       – how the 700K jobs are to be created, where and when (because that looks huge)

       – how the computation the “ROI” (I am sure it isn’t called that way in that context) adds up.

       Here’s a real chance to work with the opposition liberal senators and unify against the Duterte threat.

       DDS will of course frame it as “helping Marcos-yellow crony-oligarchs” and if they don’t do it the PH Far Left will.

       But yes let’s just put this out and see who picks it up, it feels like sending messages to aliens out there, but well.

       Reply
       • Joey Nguyen says:

         April 14, 2026 at 12:25 am

         – how the 700K jobs are to be created, where and when (because that looks huge)

         700K-ish jobs created over 10 years is actually a conservative estimate per my original instruction. The estimate was modeled off of the other ASEAN-6 countries (7 indirect jobs for every direct factory floor job) with a handicap applied to the Philippines (5-6x indirect jobs for every direct factory floor job) to account for immature inter-island transport. Aside from the jobs themselves, the job salaries are also much higher than the typical Philippine salary (1.7x national average for completely unskilled general assembly line worker).

         – how the computation the “ROI” (I am sure it isn’t called that way in that context) adds up.

         In public investment terms the fiscal multiplier is the macroeconomic analogy to the microeconomic ROI (which pertains more to singular entities which can be an enterprise, project, individual, and so on).

         https://en.wikipedia.org/wiki/Fiscal_multiplier

         My analysis predicted a fiscal multiplier over 10 years of 4.2x-6.8x, which would put the Philippines on par in 10 years with where Thai and Indonesian government investment is now. Which might seem depressing but this is a 10-year catch-up plan compared to e.g. Thailand’s 40 years in the automotive sector. Well, that is if something like the result of my analysis is passed then implemented.

         DDS will of course frame it as “helping Marcos-yellow crony-oligarchs” and if they don’t do it the PH Far Left will.

         Far left discounted aside for their constant yelling despite small numbers…

         Important to note here that DDS has spent more than 10 years building their relational debt networks (utang na loob networks) while those who oppose DDS have not. In the absence of a better offer that would show pro-democracy side can provide better benefits and thus shift the utang na loob network over, one cannot blame the voter for voting for Sara in 2028. All the more important to unveil big, bold ideas now to inspire people… then get to the hard work of showing progress is being made towards the new future.

         Reply
         • Irineo B. R. Salazar says:

           April 15, 2026 at 4:12 am

           Important to note here that DDS has spent more than 10 years building their relational debt networks (utang na loob networks) while those who oppose DDS have not. In the absence of a better offer that would show pro-democracy side can provide better benefits and thus shift the utang na loob network over, one cannot blame the voter for voting for Sara in 2028. All the more important to unveil big, bold ideas now to inspire people… then get to the hard work of showing progress is being made towards the new future.

           When I see people who have (I would think) stable jobs in Europe dance budots in front of the ICC prison to support Duterte, who for sure doesn’t have THAT much money to pay their bills for being there (what their days salary is worth plus board and lodging, go figure), I have doubts about them similar to your doubts about PPop fans, and putting all that together I wonder if one can see MOST Filipinos as a whole through a rational lens AT ALL.

           Let’s say I am giving this a shot, but I don’t really have to care that much as I have removed the Philippines as any form of serious option for my future. Nowhere in the world is fully safe nowadays but I see more rationality where I am now, or maybe I get how things roll here in Europe best by now. If your plan is done and helps win the race in 2028, or the race is won in any other way, I will still have a PHilippines I want to visit – otherwise I won’t, period.

           Reply
           • Joey Nguyen says:

             April 15, 2026 at 4:53 am

             If you recall I discussed the Strauss–Howe generational theory with LCPL_X a few times:

             https://en.wikipedia.org/wiki/Strauss–Howe_generational_theory

             A short summary of the theory: Every 80 or so years, broken up into 4 generations 20 years each, there is an immense societal crisis precipitated by decadent degradation that requires new thinking. According to Strauss and Howe the “GI Generation” was one such “hero” generation that build the present world order after going through the crisis (WWII). Similarly we may see the statesmen and builders of the Third Republic as a hero generation who attempted to build the same.

             In the case of the Philippines there seems to have always been a legacy of Ilustrado-thinking vs Katipunan-thinking. From my understanding the Ilustrados favored logic-based incrementalism and building sturdy foundations while the Katipunan operated on a more emotionally driven and tribalistic manner. It is a shame that the Ilustrados were co-opted in a way by the Katipunan, who survived due to being defeated by the US. I’ve read some works that the current dynasties are neo-Ilustrados in the sense that they are usually of the landed class, but their mode of thinking is performative like the Katipunan.

             A few weeks ago I had a discussion with an older Fil-Am friend, an Atenista who had left the Philippines shortly before EDSA, about the original usage of OPLAN. It turns out the first oplan was Marcosian Oplan Katatagan in the 1980s against the communist insurgency. Nowadays “oplan” is used for everything to dress up the plan in to denote the plan as super serious and a big deal. Which to me seems quite militaristic and well, OA.

             The Third Republic statesmen may have not used “oplan,” but they did appear (at least to me) to try to approach Philippine problems with a degree of seriousness and proper planning according to what they knew. In other words those now-gone statesmen tried to plan strategically in order to achieve goals for Filipinos. Which is what an operational plan is all about. Btw, the original US military “oplan” was usually quite broad and were the particular operational plans to achieve the military strategy (i.e. “take this hill”). Where the Third Republic failed later on was that adjustments to new conditions were not made in real-time. I haven’t been able to find good writing or studies that explores this area further, but one can presume that perhaps the leaders then did not have complete information or maybe they did not have the prerequisite knowledge to adjust on the fly.

             Well the good thing is in today’s word there is the benefit of hindsight (to look back at the mistakes of prior generations) and a plethora of new examples of success not only from the US and Europe, but from nearby neighbors, in addition to what not to do (don’t go full communism). I know for sure that there are many patriotic Filipinos who are highly educated and highly experienced, some even stayed in the Philippines rather than migrating, yet don’t have positions where they can help effectuate change. So the power needs to be politically delegated to those Filipinos to create that change. More Ilustrado-thinking, and less Katipunan-thinking.

             The proposed EVIS bill has not be disclosed aside from the public releases and statements, but it does look like the bill if passed would at least partially checkbox some of my proposals… not all is lost…

             I would still encourage you to visit sometime. The Philippines is still a nice country to wander around in, eat some good food, meet new people, have girls chase after you which happened to me recently (haha), and catch up with old friends. The important thing to remember I suppose is that the Philippines despite feeling a bit janky and cobbled together, feels unique and genuine with a lot of character, like old-school jeepneys personalized by their owner-operators. That alone is worth it to me to visit. When starting near the bottom and from behind, there’s no where to go but up and forward.

             Maybe in a way your father is right after all in his Pantayong Pananaw: now is the time for bayani.

             Reply
             • Irineo B. R. Salazar says:

               April 15, 2026 at 11:50 am

               In the case of the Philippines there seems to have always been a legacy of Ilustrado-thinking vs Katipunan-thinking. From my understanding the Ilustrados favored logic-based incrementalism and building sturdy foundations while the Katipunan operated on a more emotionally driven and tribalistic manner. It is a shame that the Ilustrados were co-opted in a way by the Katipunan, who survived due to being defeated by the US. I’ve read some works that the current dynasties are neo-Ilustrados in the sense that they are usually of the landed class, but their mode of thinking is performative like the Katipunan.

               Pantayong Pananaw seems to see Aguinaldo and his group (Katipunan 2.0) as impure while Bonifacio (Katipunan 1.0) were the real deal not given a chance.

               A few weeks ago I had a discussion with an older Fil-Am friend, an Atenista who had left the Philippines shortly before EDSA, about the original usage of OPLAN. It turns out the first oplan was Marcosian Oplan Katatagan in the 1980s against the communist insurgency. Nowadays “oplan” is used for everything to dress up the plan in to denote the plan as super serious and a big deal. Which to me seems quite militaristic and well, OA.

               yes, I grew up in the time when Oplan became part of the Philippine vocabulary. It still sounds like Martial Law to me.

               I would still encourage you to visit sometime.

               that will happen in due time.

               When starting near the bottom and from behind, there’s no where to go but up and forward.

               The thing is that without a proper map, figuring stuff out from the bottom up is very time-consuming.

               I still believe that Philippine education doesn’t help people conceptually link their bottom up view with the top down of maps or vice versa.

               So you have the perception that Mar Roxas’ was about “analysis paralysis” like Binay said to him and that Marcos Sr.’s “action agad” was good.

               Maybe in a way your father is right after all in his Pantayong Pananaw: now is the time for bayani.

               My father and Xiao differ in that the former sees Rizal (and Ninoy) only as “heroe” meaning “performative Western heroes” (well yes the ilustrado were as you mentioned often dandies, with well-combed moustaches I might add, a style only Robin Padilla and Tito Sotto now sport) who were all talk (and uselessly martyred themselves) while Bonifacio was the true bayani who cared about the bayan and “did something”. Though Bonifacio also got himself killed – by Filipinos.

               There is the story I found out reading Jim Richardson’s work on the early Katipunan that Bonifacio when he fled uphill to Balara (not yet to UP Diliman, the modern refuge of rebels haha) he had panday there forge a lantaka but it wasn’t powerful enough to pierce modern Spanish walls.

               Xiao BTW understood my view in my old blog of how Bavaria built its industries from the bottom up after WW2 – even if I lacked the top down view of how it was built, seeing it from the ground inspite of books on Industriepolitik in available in libraries. Now it is my (self-imposed) job to follow up on that and convince people your plan is not “analysis paralysis” and not aimless “action agad” – ABANGAN on April 26, draft is already in progress as of now.

               Reply
               • Joey Nguyen says:

                 April 16, 2026 at 12:06 am

                 The thing is that without a proper map, figuring stuff out from the bottom up is very time-consuming.

                 Yes this is true, but the Philippines already tends to go the time-consuming route by insisting on reinventing everything, but Pinoy™.

                 There’s nothing wrong with adapting stuff to suit Philippine needs, but the constant need to be “special” and praised (commonly with masa boys, more dangerously in hero-of-the-masa type leaders) is definitely a mental block.

                 Examples and templates are available widely now as a sort of open-sourced collective human knowledge stretching back thousands of years, no longer constrained by the requirement of physical, hard contact (war).

                 I still believe that Philippine education doesn’t help people conceptually link their bottom up view with the top down of maps or vice versa.

                 It’s not a requirement for most Filipinos to know all the things. It is a requirement however, for leaders to have the ability for conceptual linkage. During PNoy’s time there were many of these leaders. Then there was a rapid regression under Duterte and a partial reconstruction under Marcos Jr.

                 So you have the perception that Mar Roxas’ was about “analysis paralysis” like Binay said to him and that Marcos Sr.’s “action agad” was good.

                 One needs to take a look at how these narratives came into being though: negative simplistic narratives arose in the absence of positive examples that are attractive to being copied. If I recall now, Mar Roxas’ explanations were just way too long, too complicated, and without an understandable narrative for the audience. He was speaking with a cadence understandable to other elites, not in a way that the masa understood.

                 From many years among mostly the DE when I visit, DEs may be uneducated but they are definitely not bobo. What would be more powerful, I think, than simple biting slogans is showing an example of how one can benefit from doing XYZ. But it needs to be something concrete and correlative… such as “support X and get Y.” e.g. “Support this plan to build cars, and your local rubber tapping industry will have higher profits.” Perhaps one can see it has a difference between theoretical learning and practical teaching.

                 In direct communication there is no need to explain details (as us being sometimes egg-headed tend to do) like “we will proceed to build a latex processing facility, then vulcanizing facility, then rubber tires facility.” All the subsistence farmer who has a half-dozen rubber trees he taps latex from to sell in raw latex cup form for a pittance to a middleman, after waiting weeks for the smelly tubs of raw latex to ferment beside the house, knows is “will I earn more money from this change to support my family?”

                 Reply
                 • Irineo B. R. Salazar says:

                   April 16, 2026 at 12:49 am

                   Mar Roxas’ explanations were just way too long, too complicated, and without an understandable narrative for the audience.

                   Haha, Joe after he first met Mar Roxas personally described him as being similar to ME – but I had extremely long-winded comments then. Look at my articles from the pandemic period to see how I wrote then compared to how I write articles NOW.

                   Well, being both Service Owner with a direct contact to business role for two (among many other) applications since 2021 taught me a lot about talking to end users, the equivalent of talking to non-elites in politics – possibly helping change the way I explain things in general.

                   “support this plan to build cars, and your local rubber tapping industry will have higher profits.”

                   und damit bekommt die Stadt X bis zu Y Arbeitsplätze (and with the, town X gets Y jobs) – I just thought of how politicians talk over here. Makes sense.

                   The word latex made me think that a Durex factory just beside the rubber plant would be a good idea.

                   Not just higher profits but free condoms for the farmers and their sons.

                   Reply
                   • Joey Nguyen says:

                     April 16, 2026 at 2:31 am

                     Haha, Joe after he first met Mar Roxas personally described him as being similar to ME – but I had extremely long-winded comments then.

                     I actually prefer your long-winded comments and blogs since we both have the intellectual training to follow along and ask pertinent questions. To each audience the communicator needs to craft a message that would resonate with that audience.

                     taught me a lot about talking to end users, the equivalent of talking to non-elites in politics

                     One of my criticisms of PNoy is that while PNoy was a very humanistic President, he was not good at explaining things to the broader Filipino, and most of his cabinent (including Mar) weren’t much better. Even Leni isn’t that great as a communicator, but she makes up for it by showing with her physical presence and hands-on leadership which Filipinos can also appreciate.

                     und damit bekommt die Stadt X bis zu Y Arbeitsplätze (and with the, town X gets Y jobs) – I just thought of how politicians talk over here. Makes sense.

                     I’m not as tuned into German politics aside from what I follow from non-German media and reading DW (Deutsche Welle) which is in my daily newspaper rotation, but it appears to me that AfD’s recent strength is in part with the simple message that noxious party offers as well as the overly cautious messaging style of the Merkel to Scholz era CDU and SPD. It appears the new CDU-SPD coalition under Merz is able to combat some of AfD’s messages.

                     Another observance I have about Philippines politics is stuff usually goes by the maxim “My way or the highway,” with the corollary “I’ll just wait until I win again.” Surely with a political system that has weak parties and where politicians often jump parties then back again, there is room for coalition building and deal-making. Not deal-making in the sense of pork barrel, but real, concrete deals as in “support the X law and your district gets Y factory/facility/port.” Something the politician can go back home and campaign for re-election on.

2. JoeAm says:

   April 14, 2026 at 6:43 am

   I see nothing wrong with being a components manufacturer, or being a seafaring nation without submarines. It only makes sense to be a whole-car manufacturer if you can amass the capital for such an endeavor, and are absolutely certain there is a market for the product. The Oligarchs are rich enough but have other priorities they judge as better in risk and return. Not having a car manufacturer does not make the Philippines an inferior nation. It may make it a smarter nation. Demanding submarines and autos is like plastering Philippine suns on automobiles, a symbol detached from the authenticity of where the nation is, today.

   Reply
   • Karl Garcia says:

     April 14, 2026 at 7:29 am

     Thanks for that sobering and hangover removing take.

     Reply
   • JoeAm says:

     April 14, 2026 at 7:56 am

     Here is a good overview of the auto initiatives ongoing in the Philippines.

     https://gulfnews.com/business/energy/ev-makers-eye-philippines-as-manila-sets-60-billion-incentives-ends-ice-subsidy-amid-global-oil-shock-1.500504974#

     Reply
     • Karl Garcia says:

       April 14, 2026 at 7:58 am

       Thanks Jo

       Reply
     • JoeAm says:

       April 14, 2026 at 8:02 am

       An example of PEZA initiatives that weave their way into the manufacturing sector.

       https://business.inquirer.net/585070/chinese-firm-invests-p30m-in-ph-plant#

       Reply
     • JoeAm says:

       April 14, 2026 at 8:06 am

       Update on Philippine debt to GDP ratio. Projected to decline.

       https://www.bworldonline.com/economy/2026/04/13/742572/phl-debt-to-gdp-to-continue-declining-amro/

       Reply
   • Joey Nguyen says:

     April 14, 2026 at 8:37 am

     If you have time to read my analysis, the analysis addresses all of your concerns.

     Namely:

     • Increased incentives for local assembly first
     • New incentives to encourage local parts supply chain
     • Domestic market served by locally assembled cars, then locally manufactured cars
     • Development of adjacent industries: batteries, rubber, steel, electronics

     Cars for export is actually last in priority. National pride in locally made stuff is just a “nice byproduct,” but the real aim is to capture local job creation, technology transfer, bring capital into Philippines, and increase value-added position within the local then global supply chain. The co-developed industries would also support future industries in other areas. The last reason of co-development and parallel tracks are the reasons why properly industrialized nations almost always create a policy for an automotive industry. Which is a lot more useful than building a handful of submarines.

     As to the oligarchs having enough capital — they do have the capital. What they don’t have is a regulatory framework which makes a business case for expanding outside of rent-seeking behavior. To have a regulatory framework there needs to be first a legislative framework which creates a more predictable investment environment. A more predictable investment environment would also encourage more foreign capital to co-invest and transfer technology in order to access the labor and resource markets.

     Reply
     • JoeAm says:

       April 14, 2026 at 12:07 pm

       Makes excellent sense, thanks.

       Reply
3. Irineo B. R. Salazar says:

   April 18, 2026 at 3:58 pm

   video below: a 4000-acre site (it seems in New Clark City) is planned as US-PH cooperation for manufacturing semiconductors under the “Pax Silica”

   Reply
4. Irineo B. R. Salazar says:

   April 20, 2026 at 4:04 pm

   https://x.com/pdokprodo/status/2045725547372974082

   interesting X post on logistics in the Philippines vs. Thailand (also considering the archipelagic constraints):

   If you want to know why basic food and manufactured goods are so incredibly expensive in the Philippines compared to Thailand or Vietnam, you have to look at the Logistics Performance Index.

   In Thailand, the logistical cost of moving a product (warehousing, transport, port fees) consumes roughly 14% of the product’s final retail price.

   In the Philippines, that logistical friction consumes over 25%.

   This is the Island Penalty. We are an archipelago suffering from chronic under-investment in deep-water ports and rail lines. Because we lack a unified, state-funded freight railway system, a single tomato grown in Mindanao must pass through a gauntlet of monopolized domestic shipping lines, expensive privately-owned tollways, and catastrophic urban gridlock.

   You aren’t just paying for the tomato. You are mathematically paying for the state’s failure to build efficient bridges and trains. We can never beat Thailand’s export economy if moving the goods costs more than making them.

   👇 Let’s discuss transport economics below:
   Should the government nationalize the tollways and cargo ferries?

   

   Reply

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1. Is a Philippine Detroit possible? Checking out Industriepolitik | The Society of Honor by Joe America says:

   April 22, 2026 at 6:02 am

   […] The plan argues that the Philippines still has a chance to position itself to build an automotive industry if it adopts a coordinated industrial policy: Industriepolitik as we say in Germany. It lays out a legislative and institutional framework to move the country from basic assembly toward full-scale manufacturing in the electric vehicle sector. […]

   Reply