Business
The smoke-belching king of the Philippines is in danger of being overthrown
![Philippine companies are tackling the wage growth conundrum](https://blogaid.org/wp-content/uploads/2024/05/Philippine-companies-are-tackling-the-wage-growth-conundrum.jpg)
By means of Chloe Mari A. Hufana, Reporter
LACSON ANTHONY J. VIDUYA, 70, managed to send his six children to college using the earnings from operating a rickety passenger jeepney in the Philippine capital.
He is one of more than 30,000 drivers and operators in Metro Manila who have banded together in a jeepney modernization plan that aims to professionalize the industry, while promising to make it more professional.Fiterable.
Critics say the plan is anti-poor, and that the new business model it seeks to spawn is an example of corporate takeover.
“I joined a cooperative because I had to,” said Mr. Viduya, who bought his traditional jeepney in early 2000 after returning home from Riyadh, Saudi Arabia, where he worked as a technician for 15 years. Business world in Filipino.
The Filipino senior, who travels the Baclaran-Dapitan route via Taft Avenue, missed the April 30 deadline to join a cooperative amid the threat of losing his livelihood. He paid P20,000 ($348) when he joined his cooperative.
“I transferred ownership of my jeepney to the cooperative because I had to,” he said while waiting in line at a terminal on Taft Avenue in Manila. “Being a Jeepney driver is the only job I know.”
The Philippine jeepney operates on a ‘border system’, where the driver, usually a man, pays the jeepney owner, the operator, a fixed daily amount, called the border.
Jeepneys are known as the king of the road, mainly because of the aggressive driving behavior of their drivers. They are called both a public convenience and a nuisance because they suddenly stop in the middle of the road to load and unload passengers.
President Ferdinand R. Marcos, Jr. this month rejected a proposal to suspend the government’s jeepney modernization program, insisting it was not rushed.
About 80% of public utility vehicle operators have placed their franchises in cooperatives or corporations so they can buy new transportation vehicles, he said.
“I don’t agree with them because they said this was hasty,” the president said. “This has been postponed seven times… Those who have objected or shouted and asked for a postponement are in the minority.”
Twenty-two senators have introduced a resolution calling for the modernization program to be suspended, saying it was rushed.
“This simply shows that President Marcos has not thoroughly studied the Senate resolution, which seeks to suspend the modernization program until it is properly revised,” said PISTON transportation group national president Mody T. Floranda. by phone in Filipino.
Mr. Floranda expressed disappointment at what he said is a contradiction with the state’s policy on jeepney modernization.
He said members of a group that held a “unity walk” on August 5 to protest the Senate resolution are burdened with debt as a result of the modernization process. About 400 people took part in the pro-modernization rally.
Mr. Floranda urged the Supreme Court to expedite its decision on PISTON’s lawsuit to halt its modernization program.
“The lack of pronunciation creates more confusion,” he said in Filipino. “We still hope that the Supreme Court will support the situation of the transport sector.”
Orlando F. Marquez, Sr., national chairman of the Liga ng Transportasyon at Operators sa Pilipinas, said there may be kinks in the government’s modernization program, but most drivers and operators have accepted that it is inevitable.
That’s what pushed them to do the “unity walk,” he told a newsletterFon Sunday.
‘HUMAN DIGNITY’
Gina R. Gatarin, a researcher at Western Sydney University, said that Filipinos have long had the right to a comfortable, safe andfficient travel experience.
“But while the need to ensure that transport planning and policymaking enables equitable mobility for most people who rely on public transport is long overdue, the plans, process and policies for the transition must ensure that no one is left behind she said.
Ms. Gatarin, who wrote a study on the modernization plan, cited the need for “pathways of just transitions” in forcing the system-wide change.
Because urban mobility is about human dignity, the government must take into account not only the environment and mobility, but also labor justice, she said in the study published in April.
Some grassroots organizations have said the government is anti-poor and proFit-oriented program would aFat least 118,000 families and 685 jeepney routes have been affected in Metro Manila alone.
The modernization program started in 2017 under former President Rodrigo R. Duterte and aimed to replace traditional smoke generation jeepneys with units that have at least a Euro 4 compliant engine to reduce pollution.
The deadline for consolidating jeepneys into cooperatives expired on December 31, 2023, but public utility vehicles were allowed to continue operating until January 31, 2024. The president later extended the deadline to April 30.
The modernization program aims to create an advanced public transport system that will encourage operators to renew their fleets with higher capacity vehicles that alsofficient.
It also lays the foundation for the electrification of public transport Ftowards full decarbonisation.
“The jeepney sector is highly fragmented and individualized in terms of ownership and operation,” said a report published in 2022 by the Japan International Cooperation Agency.
It added that the lack of consolidation had led to a vehicle-to-franchise ratio of 2.25. About eight out of ten jeepney operators own a single unit.
According to the modernization program, a cooperative must have at least 15 members before it can register with the Office from the Transport Cooperatives under the Ministry of Transport.
IMPORT REGULATIONS
Elmer B. Francisco, chairman of local jeepney maker Francisco Motors Corp., said a locally assembled all-electric modern jeepney would cost P1.99 million, cheaper than imported ones from Japan and China by P2.8 million.
The company had received 60,000 pre-orders of all-electric jeepneys from across the country in June, he said. Business world via Zoom. But he cited the slow licensing process for the mass production of modern jeepneys.
There also appears to be a preference for established foreign car manufacturers, such as those from China and Japan. Local manufacturers such as Francisco Motors and Sarao Motors, Inc. can hardly keep up with demand given their limited production capacities.
“We need the support of our own government because other manufacturers – foreign manufacturers – have the support of their own governments,” Francisco said. “I call on the President to support Philippine manufacturers. Support local. We can produce our own electric vehicles.”
Mr. Francisco said modernization is important to help the environment, make commuting easier and safer for Filipinos and boost the economy.
But most jeepney drivers and operators may not be able to afford the costs of modernization, including joining a cooperative and buying new units, he said.
He shared a lesson from his late father Anastacio, who founded the company in 1947, who said, “If the jeepney operators you sell to can’t make a living on the jeepney you sell, don’t sell it. .”
Mr. Francisco also criticizes imported jeepneys that resemble minibuses instead of the traditional Philippine jeepneys painted with themes of love, sex, religion and family.
He noted that while Francisco Motors imports some jeepney parts, it assembles the units locally, providing employment to thousands of Filipinos.
Teodoro C. Mendoza, a retired professor and crop scientist from the University of the Philippines at Los Baños, cited two major “blind sides” of the state’s modernization plan: the high price of modern jeepneys and “domino evolution.”Ffect” of possible rate increases to cover the costs of these units.
This is especially true for imported jeepneys, given the peso’s slump against the dollar. High unit prices mean high annual payments, which will be exacerbated by high interest rates, he said.
Mr. Mendoza, who wrote a paper on the modernization plan in 2021, said higher tariffs mean higher costs for food and other commodities.
“In fact, higher transportation costs will mean higher costs of living,” he said in his study. “One consequence of this is that day laborers will demand higher wages, which will impact the economy as a whole.”
Mr Mendoza said the government should subsidize local modern jeepney manufacturers instead of encouraging imports.
“Why would you want to enrich foreign jeepney manufacturers?” he said Business world by telephone. “We can do that ourselves. We can manufacture them locally. That’s why we have to make it homegrown,” he said in Filipino.
“The way forward should be to support local production of modern jeepneys, supporting the initiative of Francisco Motors and similar companies,” Mr. Mendoza said. “The government should not rush because if we produce jeepneys locally, it will create employment in the manufacturing sector.”
Mr. Mendoza estimates it will take 70 years to replace Metro Manila’s jeepneys and 270 years nationwide. Nearly P12 billion is needed to replace 73,000 traditional jeepneys in the capital region, and P540 billion to replace 300,000 jeepneys nationwide.
Ms. Gatarin said that rather than a one-time, major change, the state may need to choose pilot areas where it can implement the program and show that it works.
She cited the South African experience of improving the bus system and paratransit integration, which involved a flexible transition over several years.
“This cannot be achieved by simply pressuring informal workers to hand in their old vehicles and accept it [they] will just be cogs in a Fleet management system,” Ms. Gatarin said in her research.
“What appears to be scrap metal, as the jeepney is currently framed in government statements, is a cherished asset.Freading the hard work and sacrificeFlow-income drivers to earn a decent living,” she added.
In June, the Land Transportation Franchising and Regulatory Board said it was considering another one-year extension for unconsolidated jeepneys.
“If they don’t want to help, at least they shouldn’t make our lives more difficult than they already are,” said Mr. Viduya, the jeepney driver mentioned at the beginning.