FILIPINO company Centro Manufacturing Corp. has signed a memorandum of understanding (MoU) with Nippon Fruehauf Japan to form a joint venture company that will build and sell in the Philippines insulated sandwich panels for temperature controlled vans or reefer vans.
In a statement, Centro said it had already bought a 10,000 square meter property in Cavite for the factory.
Under the MoU, the joint venture will include locally assembling ref van bodies using the insulated sandwich panels for any truck brand and model and for any brand of refrigeration system.
Nippon Fruehauf (NF) President Hiroyasu Hiruma and Centro President Raphael T. Juan signed the MoU in the presence of Trade Secretary Ramon M. Lopez, and Romulo V. Manlapig and Marissa Concepcion, head and deputy head of the Board of Investments’ project management office.
Mr. Juan said he expects to finish construction by the end of the first quarter next year, with commercial operations and sales to start by the second quarter.
“In the meantime, we will first order CKD (completely knocked down) kits from NF Thailand and parts from NF Japan to be able to serve the current demands for the new products,” he said.
Mr. Juan said an initial investment of P100 million will be used for the establishment of a plant in Maguyam, Cavite, the required production facilities, and the working capital.
He said the planned expansion and new products that would be developed would require an allocation of P500 million over the next five years.
Mr. Hiruma said Nippon Fruehauf chose to invest in the Philippines because of the strong economic growth, increasing consumer base, growing cold chain market, and booming logistics industry.
The insulated sandwich panels will be locally manufactured using Japanese materials, technology, process and quality standards, Mr. Hiruma said.
“We are in fact transferring to Centro a modern technology, the use of extruded polystyrene in lieu of the old injected polyurethane as insulating material. Because polystyrene has a lesser water absorption capacity, then it is more durable, will last longer and will be easier to maintain. It is common knowledge in Japan that polystyrene sandwich panels outlast polyurethane sandwich panels under similar operating conditions. Our studies indicate that its estimated useful life will definitely match the service life of the truck chassis on which it will be mounted,” he said.
Mr. Juan said the foreign investment inflow from NF bodes well for the government since aside from the additional value-added tax and income taxes, the joint venture would initially employ about 100 employees.
“This will also provide more job opportunities to both our upstream and downstream support industries and more business opportunities to SMEs (small and medium enterprises) that comprise the majority of our supplier base,” he said. — Victor V. Saulon