Mustapa

International Trade and Industry Minister, Datuk Mustapa Mohamed has said that prices of cars in Malaysia have been gradually reduced over the past two years, Bernama reports. Apparently, car prices have dropped by an average of 17.9% in the past two years.

Referring to his party’s manifesto issued during the 13th General Election in 2013, Mustapa said at the Dewan Rakyat, “BN has promised to continue to reduce vehicle prices between 20% to 30% within five years, and for the past two years, we managed to achieve an average reduction of 17.9%,” Mustapa, however, provided no examples of the said reduction.

On that note, he acknowledged that due to the weakening ringgit, several car companies were hard-pressed to revise their car prices. To that, Mustapa said that with the Trans-Pacific Partnership Agreement (TPPA), import duties for CBU units from the US would slowly be reduced to zero percent.

“In 12 years’ time, the import duties of US vehicles, currently at 30%, will be gradually reduced to zero percent.” Mustapa said. He added, “in addition, Japan and Australia, through free trade agreements ratified before the TPPA, will be allowed to bring in cars without paying import duties from January 1 next year.”

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Furthermore, the minister is confident that with the TPPA agreement signed, national car companies will be able to stay competitive by switching up their business strategies to produce competitively priced models.

A few brands have announced price increases that will take effect in 2016, including Toyota and Lexus (both, up by between 4-16%), Honda (up by 2-3%) and Mitsubishi (by between 2-7%). Meanwhile, Nissan and BMW are also mulling hikes, while Mazda confirmed in mid-October, that its car prices will remain the same for now.

Likewise for Mercedes-Benz Malaysia, which has announced that it will maintain its prices in 2016. Instead, the company announced a price decrease for its entire C-Class range – having benefitted from customised EEV incentives from the government.

So guys, what do you think of this claim?