The government’s decision to continue with the Open Approved Permit (Open AP) system is in line with the major goal of the National Automotive Policy 2014 (NAP 2014), which is to strengthen bumiputera participation in the national economy, The Sun reports.
“The continuation of an Open AP system will allow the participation of new bumiputera companies in the industry. It will provide the mechanism to strengthen and enhance bumiputera participation and the current 36% bumiputera equity in the sector,” Ministry of International Trade and Industry (MITI) told the English language daily.
The email statement said that a certain amount of the fees collected from the continuation of the Open AP system will be allocated to implement measures that have been outlined in NAP 2014 to increase the competitiveness of bumiputera companies in technology, human capital and supply chain development.
According to The Sun, other concerns raised included the negative impact on the image of brands owned by original equipment manufacturers (OEMs), investment by OEMs, government income in terms of taxes, implication on other supporting industries and services sectors, Malaysia’s international commitment in World Trade Organisation and free trade agreements, and investments made by current AP holders.
MITI insisted that no one was left out during the review done by its consultant. “The consultant appointed for the study had consulted associations that represent various groups in the automotive industry such as assemblers, franchise holders and used-car dealers. Several major OEMs were also consulted. Thus, views and concerns of the industry were taken into consideration in the study/review,” the ministry said.
MITI revealed some of parties consulted, including groups such as the Malaysian Automotive Association (MAA), Kuala Lumpur & Selangor Car Dealers and Credit Companies Association and Persatuan Pengimport dan Peniaga Kenderaan Melayu (Pekema).
The ministry said it also met with OEMs such as BMW Group Malaysia, Honda Malaysia, Mercedes-Benz Malaysia and UMW Toyota Motor. Views from NGOs such as the Consumers Association of Penang (CAP), Majlis Tindakan Ekonomi Melayu and Yayasan Kepimpinan Perdana were also noted.
The AP system was introduced in the 1970s to encourage bumiputera participation in the used-car industry. It came into the spotlight a decade ago when it was revealed that a handful of individuals received the lion’s share of APs issued, and the “AP Kings”, as they were dubbed, monopolised the grey import industry.
MITI issues two types of APs – Franchise APs for official franchise holders of car brands (Honda Malaysia, Bermaz Motor and BMW Malaysia, for example) and Open APs for bumiputeras to import cars of any brand and type. The Sun says that latest figures by MITI showed that there are currently 100 companies holding Open APs and 22 companies given Franchise APs.
Previously, there were plans to phase out the system. The 2009 NAP mentioned that Open APs would be terminated by the end of 2015, and Franchise APs by end 2020. In NAP 2014, the government said that it would appoint a company to do an in-depth study on the impact of the termination of Open APs on bumiputera participation in the automotive industry.
On December 23 last year, days before the system would have been ended according to the original timeline, MITI announced that the Open AP policy will continue but with improvements to the current system. The improvements, which are yet to be disclosed, will take effect from January 1, 2017.
“The government will (also) launch a programme to use a portion of the open AP fees to enable the public to directly benefit from this new policy. The details of this programme will be announced later,” MITI said.
“The research team opined that the current Open AP system gives opportunities to the public to purchase used imported cars at a competitive price. They also found that the distribution and importation of used cars industry contributed significantly to the automotive industry and the country’s socio-economic development,” it added.
The ministry explained that the Open AP system’s contribution to supporting business and service sectors such as banking, insurance, shipping and logistics was estimated to be in the region of RM450 million per year, besides RM2 billion worth of taxes and fees to the government per year.
The system, which the Malaysian Automotive Institute (MAI) disagrees with, also directly provided jobs to 3,800 high- and medium-income earners and makes up 5% of the 36% bumiputera equity in the automotive sector, it is claimed.
“If the system were (to be) discontinued, there would be no more used imported cars allowed into the country and this would deny many people the opportunity to buy such cars. Also, the percentage of bumiputera equity participation in the automotive sector would reduce to 31%,” MITI warned.
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More like to strengten your cronies participation.How many bumiputras are actually given the chance to participate?Only a select few perhaps,all have ties with the ruling party.
Ini macam P1 bole tutup kedai lo
Strengthen kroni-kroni malas ada la
There is big difference between enriching a few bumi and ALL bumi.
Flipping a piece of red-tape document? How does that enrich the Bumiputera? To really benefit the Bumiputera’s (let’s put aside the controversial use of that terminology for now) we should get them involved with building, importing and engineering a foreign make. Not this. This will just make them greedy and over reliance on hand-outs. The hard workers do not want or need this.
Bodoh Gov. Instead of using AP to limit what vehicle can come in, they shud open to anyone can bring in, as long as must pass JPJ type approval, PUSPAKOM inspection and pay 30% excise duty. If CKD here shud charge 10% excise only. Then there is more revenue for Gov.
They only think for their own pocket sake.. which of them cares Wat will happen to country?
Each of every single policy is based on race yet the government is asking the rakyat not to be racist! Wtf!
why not G give AP to import scrap car from SG? the condition still good plus the price too. recond from japan very costly after the tax addition
Haih…tongkat tongkat….you all are not surprised that our idiotic govt decided to continue this crony-AP system anyway
“If the system were (to be) discontinued, there would be no more used imported cars allowed into the country and this would deny many people the opportunity to buy such cars.” -_-
So if remove a toll, the whole road need to be closed as well ??
‘… to strengthen bumiputera participation’ or make sure a few bumiputeras dont have to work but still make millions! … CRAP NAP!
AP will ensure they can play golf everywhere as they like while we slog to feed our family.
lets do a simple CBA. I’d put a rough estimate of 10,000 cars imported annually with Open APs. Easily RM50k profit on each sale, but lets be conservative and say 25k. So these 100 crony companies are songlaping easily conservatively RM250 mil annually from their APs. RM250mil for 3,800 jobs. That’s RM65,000 per job. Worth it? Obviously 95% of profit goes to the AP holder, their operations are basically a ‘gerai kereta’ put up payung and sell cars under the payung. Similar to pisang goreng. At least goreng pisang provide customer service, AP holder – no service, no spare, only jual then songlap.
If you put RM250mil in manufacturing, would be able to create easily 25,000 jobs, at RM10k per productive worker.
TPPA – probably delayed because gomen wanted to keep these 100 AP kings happy. Morals? Zero.
Gov pushing for TPPA, Party Hard is trying to reject. So say?
1. Only “appointed” bumi get advantage over this system, not all bumi.
2. AP king just buy used car at cheap price then direct sell to rakyat at high price, how it can increase the competitiveness of technology development, can MITI explain it in detail?
3. Here saying that continue the open AP to in line with the major goal of the NAP, but NAP already specified the termination of open AP by end of 2015?
Mmm.. maybe the NAP 2009 state the open AP “boleh” terminate, but not “akan” terminate. lol
Our gomen knows how to tok kok only.
Many many tahniah BN supporters ….. keep driving proton until die la
The word bumiputera is god. Every policies from their mouth will tie with it and make hoohaa announcement to show how caring they are. How many percentage of bumi really see what NEP is? Yes, from day one so call NEP is setup and it will only benefit to cronies family, saudara, saudari, anak, pakcik, makcik, cucu, and etc….
Nevermind. Come next election campaign, you will again pledge for the end of the AP system.
Readers who clicked tis post should be warned tat they may need to swallow some Panadols or anti-depressant pills after reading tis crap
So government helps bumiputeras. Fine. Next time need help, dont ask non-bumiputeras for help.
rubbish rubbish rubbish
Open AP, AP, licensing, quota, bla bla bla, yada yada yada.
Nobody can easily take your money from your pocket without a fight…
What we can do, we together maintain our current rides and refuse to buy any new cars and also any cars from grey importers/AP holders.
If we together do this, there will be no commission, no tax, no excise duty… later the AP system will be irrelevant…
When the buying stop, the killing can too…
When we work together, We can win this…
…then they will issue scrap car law and regulations ….
I have a stupid question….
without the AP, what’s stopping Bumiputra from participating in the industry??
Without Ap, the crony bumi will vote for the opposition.
Bullshit! Bullshit! Nothing but bullshit!
stop complain about % of bumiputra participant in AP car sector. why not open the market and compete with the world. Grow our own branding and earn your respect. with high import tax, our national cars still hide in the comfort zone and our rakyat life is in danger when driving in the milo tins.
There are more bumi car buyers than nonbumi and I dun think there are less bumis buying luxury cars nowadays. So actually everyone in Msia incl the majority bumi car buyer are forced to buy very expensive and outdated cars bcos of the few privileged bumis AP holders. Imagine buying better safer cars and have some left for the kids! So as a whole it’s actually Stupid instead of being helpful and cleaver really. Kahkahkah!
Im bumiputra. But im shame of what G done regarding AP system. Those AP solely for helping your cronies. Its only benefit a fews greedy Dato/TS/DS. Stop giving excuse by playing racist sentiment la.
Malaysian need a better system. Not those jurassic system.
i think we must hv a one type of school only..
I’m Bumiputra and I against the status quo of AP in automotive or any sector for that matter. WE deserves better than buying used old car from developed countries yet charged with double to treble of original price in their exporting countries.
Importing brand new or used or high value classics with open policy and monies generated goes to government coffer, completely.
Revisit other AP too, Bumiputra or Cinaputra or Indiaputra or Mamakputra.
Look at the custom import declaration of imported used cars. They declare ridiculously low. They sell those used wish, alphard, etc astronomically high. So, the wonderful rakyat work hard for these ap kings and the banks.
Hooray!!! One big reason BN lost big in 2008 is becos of this crony policy. Thats why they promise review of NAP in 2009. Now they puck the Malaysian again becos the people already forget.
Lets bring down BN in 2018 and teach them people are not stupid.
Dont be jealous aaa.. sama sama enjoy profit meh
AP system is a sure-firing system only enrich “selected” bumiputra cronies.
other bumiputra arent as fortunate….and worst, dikencing kan lagi
Open the APs to all BUMIPUTRA let them bid for the APs not just given to a selected few then i believe you’re helping the Bumiputra.
MITI, we knew then that you harebrained rationale for postponing this AP was because of this. We knew then that you up to no good. We knew then, that the AP cronies will never give in and that you will come up with some excuse or the other to benefit them. So don’t come and give us your BULL story. We weren’t born yesterday. If you had those discussions with those concerned parties that you mentioned. Give us a FULL script of the going on’s of those meetings.
more affordable luxury MPVs and SUVs will be available in the market
All done my Mahathir, to make Malaysia a used car nation with Plotong flop.
Thailand and Indon must thank him for their auto industry growth.
My cousin just bought a new 2013 Preve long term sunbather.
All also plunder la.