AC Industrials of the Ayala Group is seeking to bolster the country's manufacturing capacity, as it is slated to begin producing motorcycles early next year. AC Industrial now serves as Ayala Corp.'s core industrial unit, combining its automotive interest with that of electronics manufacturing.
The company will now house the existing and prospective assets of Ayala automotive and semiconductor manufacturing business, Integrated Micro-electronics Inc. (IMI).
Ayala inked earlier this year a deal with Austrian motorcycle maker, KTM AG, the world's fourth-largest motorcycle company, to produce at least 20,000 units of the vehicle.
This led to the creation of a joint venture, the KTM Asia Motorcycle Manufacturing Inc. Adventure Cycle Philippines Inc., a wholly owned unit by AC Industrials, will buy the output and coordinate with dealerships around the country for distribution.
Seventy percent of the first production batch will be exported to China, with the rest to be sold either in the domestic market or other Asean nations.
AC Industrials CEO Arthur Tan said this is the conglomerate's strategy to contribute to the gradually rising manufacturing sector in the country. 'The Philippines needs to address the absence of a strong manufacturing base. We depend on a lot of multinationals to come and invest in hardcore manufacturing. If that's the formula, we're not doing very well, because, compared to our neighbors, our foreign direct investments has been very low,' he reasoned.
Tan said AC Industrial's motorcycle production can be the catalyst to full product manufacturing that utilizes Filipino-made components and uses local work force.
The executive said it is very keen on automotive assembly, but thumbed down participation in the government's manufacturing stimulus program, the Comprehensive Automotive Resurgence program.
Ayala Automotive has 1,900 employees nationwide and 22 dealerships. IMI employs 4,340 people in the country.
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