Perodua: We were not consulted on excise duty change, still studying impact of increase in car prices

Perodua has confirmed that the Malaysian government has revised the excise duty structure for cars in Malaysia, but added that the impact for Perodua will likely be minimal and the company will try its best to not pass any additional cost to buyers.

Speaking at a press conference earlier today, President and CEO Datuk Zainal Abidin Ahmad said, “For Perodua, we have been following all the requirements given by the government, as far as declaration is concerned. At the moment, we are still evaluating what is the impact for us, but rest assured for the next few months, there will be no increase in prices.

“At this moment, I am saying we are trying to minimize the impact. We are studying, we are evaluating what is the impact. As much as possible we don’t want to pass the impact to customers.”

Perodua is also maintaining its sales target for 2020, which is set at 240,000 units, a cautiously optimistic figure that projects little/no growth from its 2019’s sales performance of 240,341 units.

Earlier last week, WapCar.my reported that prices of many new cars, especially locally assembled ones, will see a significant increase in prices due to changes in vehicle pricing structure.

While excise duty rates remain unchanged, specifics on what qualifies for excise tax rebates (already provided under the existing Industrial Linkage Programme, rebates given based on value of local content used) and finer details of how individual components and services related to the car business are taxed have been revised.

Some car companies estimate that prices could increase by up to 15 to 25 percent, with higher-end premium cars with less locally sourced components to be most affected.

When asked if Perodua, being the largest car manufacturer in Malaysia and a critical part of local automotive parts ecosystem, buying over RM 5.4 billion worth of parts from local vendors, was ever consulted prior to the decision, CEO Datuk Zainal said:

“We have very frequent engagement with the government, a lot of items, including those related to the development of the automotive industry, but specifically for this excise duty, to be honest, no we have not been consulted, and that’s why I think now the industry is looking at this. We are also in discussion with some members of MAA, trying to evaluate what is the impact to the industry.”