Innovation in the automotive sector of the Philippines

Abstract

The performance of the Philippine automotive industry has steadily improved following the Asian financial crisis. However, relative to the performance of the automotive industry in other countries, the sector has languished. To understand the challenges being faced by the automotive assemblers, as well as parts and components manufacturers, the innovation capability and activities of selected establishments are analysed following the framework developed by J. Bessant. This paper finds that despite having an awareness of the importance of technology and upgrading, some of the automotive firms are not able to translate this awareness into other technology activities.

Keywords:

• innovation
• automotive sector
• innovation policy
• innovation capability
• the Philippines

Notes

Refers to utility vehicles; sports utility vehicles; Asian utility vehicles; Philippine utility vehicles; pick-ups; commuter vans; light, medium and heavy trucks and buses; and special purpose vehicles.

Aldaba (2007) has listed a number of policies dating back from 1970s all focusing on improving the sector.

‘In terms of a policy framework that sets the S&T objectives and detailed guidelines for attaining these, the country has had four major ones so far since 1986’ (Macasaquit 2008, 90). Currently, the long-term National S&T Master Plan, 2002 to 2020 serves as the guiding framework for technology policy in the country.

The questionnaires were sent to a number of large automobile assemblers in the country. But because of some policy being implemented in their respective firms regarding participating in innovation surveys, the said firms have declined to participate in the study despite assurances that the names and certain details about their establishment will be withheld in the final report. Thus, the case of assemblers for this study has been limited to one local assembler and one large automobile assembler.