Malaysia Automotive Institute (MAI) CEO Madani Sahari claimed that Malaysia was on track to achieve its target of reducing the prices of cars in the country by 25% by 2018, with new cars launched this year priced between 7% to 19% lower than before.

According to The Sun, Madani said that the institute is targeting an average reduction of 5% this year, following a 4.97% reduction the year before.

“One of the most obvious reasons is market competition because the government has liberalised the automotive industry. When there is market competition, the players have to compete, in terms of pricing,” he told reporters.

He also said that a gradual reduction in car prices was vital in retaining the values of used cars, as well as giving manufacturers enough time and opportunity to optimise their operations, lower production costs through the reduction of wastages and increase quality and productivity.

In other news, Madani said that MAI is expecting an uptick in car sales from September onwards, particularly with the Perodua Axia and the Proton Compact Car (PCC) launching soon. Overall, the institute predicts sales to surpass the 670,000 units projected by the Malaysian Automotive Association (MAA) this year, with sales of 700,000 units expected in 2015.

He also talked about the future of Proton and Perodua, saying that both national carmakers have begun on their respective transformation plans and that MAI is confident they will be able to achieve their targets.

“We are confident with the existing management of Proton and Perodua to deliver what they need to do to be globally competitive,” Madani said. “I know what they are doing and I’m confident they will achieve the target.”