Sustainable winners

POSTED BY CBT Team ON 02 July 2014


When the Ministry of International Trade and Industry (MITI) presented the 2014 National Automotive Policy in January, the biggest news was that the exemption of both import and excise duties on fully-imported hybrid cars has ended, and only locally assembled hybrids, electric vehicles and energy efficient vehicles (EEVs) were entitled to full tax exemption.

This, of course, did not receive the warmest of welcomes from most manufacturers as Honda was the only one who benefited from the policy, since the Jazz Hybrid was the only car of its kind that was being assembled locally six months ago. It is currently the lowest priced hybrid car in Malaysia at RM98,000.

While many manufacturers saw the NAP as nothing more than a storm in a teacup, some have taken the initiative to make the most of the policy to their own benefit.

Mercedes-Benz invested a total of RM15 million in readying its assembly plant in Pekan, Pahang for the newly launched S400L Hybrid, which was the first car after the Jazz Hybrid to get full duty exemptions. Thanks to the manufacturer’s efforts, the car is now priced at a very competitive RM587,888.

Kai Schlickum, Mercedes-Benz Malaysia’s sales and marketing vice president said, “With the S400L HYBRID qualifying and receiving full duty exemptions, we are proud to be able to contribute in helping Malaysia fulfil its ambition of becoming a regional EEV hub.”

Looking at the more affordable end of things, Mazda has also joined the bandwagon to make the most of the 2014 NAP by assembling its SkyActiv models, which fall under the EEV classifications, locally.

While the CX-5 SUV and the Mazda3 are the brand’s only CKD model at the moment, the Japanese carmaker said that other models like the Mazda 6 are also most likely to make it to the local assembly line in near future.

Besides Mazda, TC Euro Cars, the sole franchise holder of Renault vehicles in Malaysia has also launched the company’s first locally assembled Renault sedan in Malaysia last month – the Fluence.

Competing against cars like the Toyota Altis, Honda Civic, and the Volkswagen Jetta 1.4 TSI, the CKD program has brought the car’s price to a very attractive RM115,000 on-the-road without insurance. Customers enjoy complimentary vehicle pick-up and return for scheduled maintenance too, and a courtesy car for jobs that takes more than 48 hours, five years manufacturer-backed unlimited mileage warranty and two years free maintenance.

“Our comprehensive warranty and free two years maintenance is because we want to give our customers a real deal, no such thing as alternatively free servicing,” said Reza Mutalib, GM TC Eurocars Sdn Bhd.

Come to think about it, Renault would not have been able to offer such premium after-sales services for a car that costs less than RM120,000 if not for local assembly, and the same applies to Mercedes-Benz Malaysia, which is able to sell a car so luxurious at such competitive price.

Although Honda had a good head-start, other manufacturers such as the ones mentioned above have started making the most of the current scenario to their own benefit. In the end, it is also the customers who are gaining from this as car prices are decreasing because of competition and the EEV incentives