Business

Thursday October 29, 2009

Auto players pleased with revised NAP

By JAGDEV SINGH SIDHU, HONG BOON HOW and EUGENE MAHALINGAM


KUALA LUMPUR: Local automotive industry players, stakeholders and observers are quite pleased with the revised National Automotive Policy (NAP).

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

Datuk Aishah Ahmad ... ‘Malaysia has been very much behind Thailand and this is a good opportunity for us to catch up.’

“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% foreign relaxation and corporate tax holidays for investments more than RM1bil 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.

“With regards to the aspect of consumer safety, a key measure announced was the phasing out of used parts and components by June 2011.

“While we appreciate these measures, we still have to contend with an excess in global automotive manufacturing capacity at this moment,” he said.

DRB-HICOM Bhd group managing director Datuk Mohd Khamil Jamil said it welcomed the Government’s call for the establishment of a strategic partnership between Proton and a globally-established original equipment manufacturer to enhance the national carmaker’s competitiveness.

“Proton needs the right partner with an experienced track record and expertise to take it through its challenges. DRB-HICOM is ready to assist and work together with the national car company to stimulate its growth domestically and regionally whilst, at the same time, playing a role in enhancing the national auto industry,” he said.

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