The Malaysian automotive industry is expecting competition in the local market to intensify as the government reduces excise duties further to lower new car prices.
The governing Barisan Nasional party made a pledge in its manifesto to reduce car excise duties, which would lead to a gradual decrease in car prices of between 20% and 30%.
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BMW Group Malaysia Chief Executive Officer Gerhard Pils told the Bernama news agency that the reductions would cause local carmakers – Proton and Perodua – to compete with imported cars locally and internationally.
“Local manufacturers should not be afraid if the government reduces car prices. They must start thinking of how to make local cars better and more competitive with international car manufacturers like Honda, Mazda and Mercedes-Benz,” he told Bernama Wednesday.
Pils said the gradual reduction of car prices would also open up manufacturers’ mind to create something sophisticated to attract buyers to buy their products.
He also supported the government’s initiative to lower car prices in stages as a move to support the local automotive industry.
“If the government reduces car prices on the spot as the opposition would like to do, it only brings good news to the buyers but not for car makers and distributors like us.
“When it is done gradually, stage-by-stage, it will give us some time to investigate the new retail price for cars that suits the cost of raw materials, operational, manufacturing and related costs,” he said.
