We may soon see the death of the trend of private registration consumer diesel cars and trucks in Malaysia! This is because if everything goes as intended, diesel at the pump will soon be unsubsidised, with the government looking at alternative ways to deliver subsidies to those that they deem needy. Diesel at the petrol pump is now RM1.581 per litre. With the subsidies taken off, it is expected to cost more than RM2 per litre. This may kill the sales of popular lifestyle trucks which are driven by consumer purchases, while the business workhorses will probably not be affected as much.
At this point it is not clear which exactly parties the government will continue to subsidise, but according to Domestic Trade and Consumer Affairs Minister Datuk Shahrir Samad it would include school buses, the transport sector like buses and taxis, and other economic activities which the government deems require diesel subsidy.
“We are looking at various ways to restructure the mechanism in providing the diesel subsidy as our first area of focus on subsidies. We will look at how to raise the price of diesel at the pumps to a non-subsidised price, and the subsidy to reach the target group instead. If the price is raised at the pumps, then there will be no smuggling of the commodity or abuse of the diesel subsidy,” said Datuk Shahrir.
A salaryman who bought a 2.5 litre turbodiesel pickup truck in efforts to save on his monthly fuel bill by trying to make up for the more expensive road tax with the monthly savings in fuel expenditure could end up being on the losing end in this deal. Together with the recently reported bad crash test results with pick-up trucks in general, we may see the popularity of pickups diminish significantly.
But with the ability of diesel engines to usually extract more kilometers out of each litre of fuel, it may continue to be popular, just not as wallet-friendly as before. We will just have to wait and see what the market price is if this proposed plan is put in place.
