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NEWS UPDATES 29 October 2009

Automotive industry pleased with Malaysia’s new policy

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Malaysia’s automotive industry players, stakeholders and observers are quite pleased with the revised National Automotive Policy (NAP) unveiled yesterday, reported the StarBiz, a local business daily.

Malaysian Automotive Association president Datuk Aishah Ahmad said she was opimistic that the measure to allow foreign auto players to take up a 100 percent stake in local plants producing luxury vehicles of 1,800cc and above (effective Jan 1, 2010) would entice foreign manufacturers.

“Perhaps they could set up base in Malaysia for export to the rest of the world. I think Malaysia has been very much behind Thailand and this is a good opportunity for us to catch up,” she said after a briefing on the review of the NAP yesterday.

Aishah also said the gradual phase-out of imported used parts/components and commercial vehicles was a practical decision. “We encourage it. For safety’s sake, we think it’s not good to bring in used vehicles that are substandard.”

OSK Research auto analyst Ahmad Maghfur Usman, who was at the briefing, said he was “excited” about the new NAP. “I am excited. We’ll see how things go for 2010, when there will be more investments in the country – more competitive prices for luxury cars in the 1.8-litre segment. I think this would put pressure on Japanese luxury makes like Lexus, Toyota and Honda,” he said.

However, he added, Malaysia was still behind countries like Thailand that offered better incentives for foreign automakers.

“The initiatives would help boost Malaysia as a place for foreign investment but Thailand still offers better incentives. It has 100 percent foreign relaxation and corporate tax holidays for investments more than 1 billion ringgit (1$=3.5 ringgit) for five years.

“The key thing here is the partnerships. How far are local players willing to establish partnerships with foreign automakers? All the car manufacturers in Thailand are foreigners. There’s no local full-fledged auto manufacturer over there,” he said.

BMW Malaysia Sdn Bhd managing director Geoff Briscoe said in a statement that the Government’s decision to implement Euro-4M specification for petrol and diesel by 2011 was a welcomed move.

“We see this move as an encouraging and proactive measure by the Government to further promote clean and sustainable technology in the Malaysian automotive industry,” he said.

Honda Malaysia Sdn Bhd, currently one of two companies offering hybrid cars in its line-up, applauded the Government’s decision to encourage the development of hybrid and green technologies.

Managing director and chief executive officer Toru Takahashi said, however, that the company had no immediate plans to commence local assembly of its hybrid models.

“At the moment, we hope that the extension of CBU (completely-built-up) hybrid tax incentives could be reviewed in order to further promote green technology,” he said in a statement.

UMW Toyota Sdn Bhd president Kuah Kock Heng said the development of a high value-added parts and components sector would augur well for the future of the Malaysian automotive industry.


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