Thursday, May 30, 2013

'Do not have any illusion of cheaper cars'

Harakahdaily,29 May 2013

May 29: The announcement by International Trade and Industries minister Mustapa Mohamed that the government would reduce car prices between 20 per cent and 30 per cent over five years was a message to Malaysians to forget about buying cheaper cars.

“In effect, the BN government is telling Malaysians that they can stop dreaming of cheaper cars for the next five years, and if car prices drop at all, it will be after the 14th General Election,” said Petaling Jaya Utara member of parliament Tony Pua.

Pua challenged Mustapa’s reasoning that car prices would be reduced in accordance with “market forces”, which had failed to bring car prices down over the past 20 years.

“(Then) why Malaysians should believe that these same 'market forces' will suddenly be able to result in a 20-30 percent drop in prices over the next five years?” he asked in an opinion piece on news site Malaysiakini.

The DAP national publicity secretary said new cars remain costly in Malaysia due to government taxes and protectionist policies for local car companies.

He also dismissed Mustapa’s claim of serious impact on the automotive industry with lower car price, including massive loss of jobs as well as a blow to the second hand car market.

Instead, Pua said reduction in excise duties would have no impact on car companies' profits and by extension its workers.

Countering Mustapa’s claim of worsening traffic jams, Pua said car ownership in the Klang Valley had exceeded the 1:1 ratio, thus cheaper cars would not worsen the already bad traffic congestion.

“Taxing the people more, while maintaining the existing duties are the only means by which the BN government will be able to continue funding its largesse and excesses,” he added, and suggested that the public can brace for more "broken promises to come".

~ Harakah Daily

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