The paper presents the profile and the problems of the Philippine automotive parts industry viz.: (a) little difference between prices of locally manufactured parts and imported parts (b) preference for imported parts; (c) scrapping of the local content requirement in the year 2000; (d) dominance of MNCs in the industry; (e) insufficient capital of local parts makers; (f) lack of technology; and (g) small domestic demand. It likewise discusses the factors affecting its sales in the domestic market such as: (a) foreign exchange; (b) production cost and profit margin; (c) distribution channels; (d) tariff; and (e) national internal revenue tax. The paper concludes that continued government support is needed by the industry for it to flourish and be competitive.
