MITI now allows Open AP holders to import any car
The Ministry of International Trade and Industry has taken the Malaysian automotive industry a step backwards with a new policy that allows holders of Open APs to import any car they want, effective June 18 2007.
Previously, Open AP holders could import any cars they wanted except for models that have been assigned to the franchise AP holders, which makes sense really as the market would be messy with parallel imports by these Open AP holders damaging the sales and undercutting the prices of Franchise AP holders who have taken time and money to invest in this country with proper service centers, customer service, and etc.
We might see many special “Open AP-holder editions” of popular cars like the Toyota Wish and the BMW 3-Series, sold at a price that undercuts the franchise holders. Judging by the amount of people who bought the Wish before UMW Toyota brought it in officially with warranty and support, it looks like many seem like they do not care much about warranty.
Franchise AP holders are sure to be re-evaluating their current and future investments in the country because of this move. I do not see how this can move our industry forward other than making the few holders of Open APs richer at the expense of FDI.
I hope MITI has a very very good reason for this move. After all, it’s own Minister disagrees with the system. “To me, the entire AP system should be abolished. It goes against the World Trade Organisation agreement. This is my personal opinion although others may not agree with me,” said Datuk Seri Rafidah Aziz back in 2005 at the opening of a seminar organised by MAICCI.
UPDATE: The total amount of imported used cars however, have been restricted to 3% of total industry volume, which would mean about 15,000 units this year. The free-flow of car models allowed to be imported is also restricted to cars coming in from ASEAN countries.
“DRB group views with concern the development in relation to the issuance of unrestricted open APs especially on its luxury branded marques that we distribute and assemble,” said a DRB-HICOM spokesperson. DRB-HICOM has invested heavily in local assembly for foreign makes including Honda and Suzuki. It also imports Audi, and Mitsubishi cars.
July 7, 2007 @ 6:21 pm
The minister said no but the ministry said yes. What’s this?
July 7, 2007 @ 6:23 pm
Bad news for the local cars, I guess. Especially Proton
July 7, 2007 @ 6:59 pm
i think some1 in d minister has a tie-up wit an car importer company.
by doin tis, he/she will gain some commission.
after general election, he/she might b replaced wit younger personnel.
hehehheheh
where d savvy lite coverage?
July 7, 2007 @ 7:25 pm
Step backwards? Why? Because of warranty issues? Feel that this should be an open market and everybody should be able to import. This is just a step towards a free market and this move should reduce prices. Or am i getting something wrong?
And the tie-ups and commissions (see haroldz’s comment) should rather be happening with Franchise APs. So I think that is good news.
July 7, 2007 @ 7:35 pm
The market has not become more open. It has become more closed, as these select group of Open AP holders have now even a bigger advantage over everyone else, including the principals themselves!
July 7, 2007 @ 7:42 pm
Open holder AP will monopolize d imported cars market.
How will these effect d motoring industry?
will we able to import our favourite import car cheaper?
just wait n see like usual la…………..
July 7, 2007 @ 8:07 pm
There is a quota so the number of imported cars coming into the market won’t be overwhelming. However, it does introduce some new dynamics to the car market. Hopefully we as the consumer will be able to benefit.
July 7, 2007 @ 8:53 pm
I,m not sure this news is good or not, maybe benefit to some…but i really dont like this tamak minister rafidah..errkhhh
July 7, 2007 @ 9:06 pm
I can agree with PT 50% only if what someone posted in previous thread as mentioned below: -
http://paultan.org/archives/2007/06/26/thailand-gives-malaysia-afta-rates-finally/
“longjaafar said,
June 27, 2007 @ 3:15 pm
The reason why Thailand allow import of Malaysian cars now is that our govt at last removed restrictions on the number of AP’s that manufacturers are given to bring in CBU cars from Thailand.
So now UMW can have as many AP’s as they want to bring in Toyotas assembled in Thailand. They do not have to go through ‘third parties’ and pay hefty premiums. In the past, people like UMW had to resort to ‘buying’ AP’s once theirs are used up. However, for cars imported from non ASEAN countries, the rules and tax structure are different.
The interesting thing is how our local newspapers presented the news. I think it is a matter of saving face that the removal of restrictions on number of AP’s is separated from Thailand’s agreement to the reclassification of Malaysian cars exported to Thailand. It was actually quid pro quo.
We do want to be seen as bowing to the demands of Thailand, but that is what’s happening. I think Thailand has strong grounds not to allow Malaysian cars to qualify for AFTA duties, because of our AP system. Now their patience is rewarded and I’m sure there are many red faces in MITI.”
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So, the open AP is for “checking vehicle” means no limitation in term of nos. Any Ah Chong, Muthu or Ahmad can get this AP to import any car they want. Of course the manufacturer know how to protect their franchise holders or agents interest. Remember AP is so valuable in our country and can make cronies rich. But for foreign manufacturer, it is a crap of a piece of paper regulation to suck monies.
July 7, 2007 @ 9:32 pm
franchise aps and open aps are 2 diff things. the thailand thing is likely related to franchise aps. franchise aps are just papers. open aps have financial value.
July 7, 2007 @ 11:01 pm
does this mean cheaper cars or just more choices?
July 7, 2007 @ 11:21 pm
Why not just scrap AP. It’s just a market monopoly tool so that the rich gets richer.
July 7, 2007 @ 11:24 pm
mystvearn, according to Paul it means less choices. This is bad news, certainly. But I am quite confused now on the differences between open AP and franchise AP… don’t have a clue how each of them works if this is all true.
July 7, 2007 @ 11:35 pm
i wan a cheap Peugeot 407!!!
July 7, 2007 @ 11:48 pm
The Minister said, “To me, the entire AP system should be abolished”…. Of course our dearest Minister, all your friends have made the money they wanted already, haven’t they from the old AP scheme?
July 8, 2007 @ 2:49 am
actually it means more choices, because now the open ap 2nd hand car style retailers can import any car they want.
but might be bad for fdi
July 8, 2007 @ 3:44 am
there said imported used cars but only for a limited amount.
July 8, 2007 @ 3:48 am
Open APs are restricted to 3% of industry volume. im not sure how you related amount of cars to choice of cars.
July 8, 2007 @ 4:47 am
PT, wah got two types of APs ah ….. next time more and more type of APs come out - Limited Edition, MME edition, and not long ago, recycle APs.
Talk about 3% of industry vol, that is only official %. But what I know few year back when this AP was a hot issue, the nos of AP issued at aroung 60K or more than 10%?
July 8, 2007 @ 7:49 am
sorry la. not understand mah. my english is very bad 1.
July 8, 2007 @ 8:59 am
heard UMW didn’t sell much WISH… introduce in Bolehland too late… parrarel importer pocket them first…. hope this teach franchise holder a lesson…. don’t wait until model already EOL and then launch in Bolehland….
its time to change!
July 8, 2007 @ 12:28 pm
kesian p1….
July 8, 2007 @ 2:41 pm
I hope MITI has a very very good reason for this move. After all, it’s own Minister disagrees with the system. “To me, the entire AP system should be abolished. It goes against the World Trade Organisation agreement. This is my personal opinion although others may not agree with me,†said Datuk Seri Rafidah Aziz back in 2005 at the opening of a seminar organised by MAICCI.
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WTF is she trying to tell the world ? That she’s already lost control in her own den ? Damn, minister…your country is really in mess !!
July 8, 2007 @ 10:09 pm
Are concept cars/one off cars/custom build cars included in AP’s?Showroom cars etc.
July 9, 2007 @ 3:09 pm
Paul,
I think these APs can only import cars that are more than 2 years old.
July 9, 2007 @ 4:10 pm
so long as cars end up cheaper, it’s all good.
July 9, 2007 @ 9:10 pm
Thank you to thailand for punish us by restrict proton imports.
very good.
otherwise our G won’t open the market.
i hope cars will become cheaper once free trade zone fully started.
if no wrong, it is on 2009-2011.
July 10, 2007 @ 9:07 am
Profits from APs funds terorrists…..
July 10, 2007 @ 9:13 pm
LOL! We Malaysian some are not terrorist.. Dont blame us all.. but blame the person who approve the AP, LOL! terrorist of $$$!
October 3, 2007 @ 2:00 am
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