Paul Tan's Automotive News

Time flies, and we’re already in the year 2011. The Malaysian auto industry landscape has certainly been more interesting than it has ever been. There are now far more choices available to consumers who are looking to buy a car than ever before. Automotive technology is getting more accessible – VTEC and Turbo was one of the only few buzzwords that we used to have to deal with in the past, now we have direct injection, twin clutch transmissions, CVT, engine downsizing, hybrids, EVs, and etc.

So yes, we’re happy with what 2011 will bring us. Unfortunately there’s also something admittedly quite worrisome approaching – this particular paragraph in the NAP review released back in 2009:

III. Gradual Phase-out of Imported Used Parts and Components

Safety and environmental concerns rose from the practice of importing used parts and components without any restrictions or mandatory tests. The NAP Review is introducing a mechanism to prohibit imports of used parts and components, effective from June 2011.

We may be out of the loop when it comes to matters of government policy but as far as we know the government has been rather quiet since 2009 on how they are going to enforce this ban on imported used parts.

The used parts ban is undoubtedly good news for the official importers of parts here in Malaysia as if implemented properly, will definitely increase their sales as people will be forced to go for new parts. And new parts prices are pretty much unregulated. Parts sales contribute a good amount to car manufacturer coffers and they can be quite expensive.

But it’s a mixed situation for consumers. The government’s reasoning for this move are safety and environmental concerns, but it may just be yet another way to keep our new car sales TIV boosted. No doubt, new parts are usually under warranty and are generally safer than used parts, but raise your hand if under a stressed budget you’d rather go for a low mileage used part manufactured by the original component maker rather than a new “compatible” product?

Do you own an old car because you cannot afford something new and/or do not want to compromise with “downgrading” to a new car within your budget that doesn’t serve your wants or more importantly needs? Ask yourself, when your car breaks down – do you go for new parts or used parts? If you usually go for used parts in very good condition such as from the low mileage halfcuts from Japan, you’re in trouble.

Banning used parts would mean when your 2003-2008 Honda City’s CVT transmission fails, you won’t be able to source a very good condition low mileage used gearbox from a Honda Fit Aria halfcut from Japan. You will always have the option of buying new from Honda Malaysia, but you will no longer have the more affordable option. It’s a good thing my E39 has a manual gearbox now – I don’t need to worry much as it’s known to be quite robust.. As for my own Proton Perdana, its 4-speed auto gearbox is on its last legs of life now and I’m already making arrangements with my mechanic to replace it with a good condition used one before June rolls along.

There will of course be existing stock in the country, but that’s not going to last long. According to Mr Danny of Soon Loi Sdn Bhd in Cheras, their chop shop stock is about 80% from overseas imports and only about 20% from cars already in the country that are chopped locally. Soon Loi Sdn Bhd has been running since the 70s by the way, and suddenly their business will no longer be viable. Where will the families running the chop shops go and what will they do?

According to Mr CM Tan of Happy Auto Parts Sungai Besi, the business of a chop shop is not something easy to do. The relationship with the foreign supplier has to be built over a long time and this can take many many years, which explains why a lot of these chop shops that are surviving have been running for decades. Mr Tan says sometimes even when you come across good cars to be chopped, it doesn’t mean the foreign counterpart will sell them to you as another chop shop may want it as there are so many other chop shops not only in Malaysia but in other countries that will fight for these cars.

You also need a trained eye to judge what cars are good to be brought in as parts cars. These guys are in family businesses that can span a few generations and Mr Tan had an interesting analogy to describe the ban proposal, claiming it was similar to telling medical students who have given their life to training to become a doctor that suddenly they are banned from practicing medicine.

This business is their trade and it is what they do best and when the right is taken away from then, you don’t hear anyone offering assistance for them to migrate to another business like how Open AP holders have an “Entrepreneurship Fund” promised to them once the AP system ends.

To be honest I still don’t know if the ban will really happen in June.