With the uncertainty surrounding the possible increase in the prices of locally-assembled (CKD) cars in Malaysia, we finally have some clarity. The ministry of finance (MoF) has confirmed via statement by the Malaysian Automotive Association (MAA) that there will be no increase in CKD vehicle prices for a period of one year until December 31, 2020.
According to the statement, on-the-road (OTR) prices of CKD vehicles will remain as is due to the transparent reporting of the open market value (OMV) as outlined in the Excise (Determination of Value of Locally Manufactured Goods for the Purpose of Levying Excise Duty) Regulations 2019 dated December 31, 2019, which is in line with World Trade Organisation guidelines.
As a recap, OMV is the final market value of a CKD vehicle ex-factory, before the government imposes excise duties on it. An assortment of components determine the OMV, and these include the cost of the CKD pack, cost of manufacturing and components as well as assembly and administration charges.
This is different to that for a fully-imported CBU vehicle, which works on a price based on Cost, Insurance and Freight (CIF), to which import and excise duties are imposed. Excise duty is between 60% and 105% (regardless of CKD or CBU), calculated based on the car and its engine capacity, while import duty can reach up to 30%, depending on the vehicle’s country of manufacture. Vehicles from ASEAN countries are not imposed with import duty.
With this announcement, increase in OTR pricing due to the new OMV calculations will be fully absorbed or exempted by the MoF effectively immediately, with car companies required to submit their OMV calculations for models affected by this new methodology to Customs.
Under the new regulations, the computed OMV to determine duties will now take into account not just the profit and general expenses incurred or accounted in the manufacture of a vehicle, but also of its sale. Additionally, any difference in duties for past years will also be exempted by the MoF.
However, does that mean there won’t be any potential increase in car CKD prices after the one-year grace period? Not according to the MAA president Datuk Aishah Ahmad, who told members of the media, “we don’t know the quantum of increase.” She noted that the new OMV calculations could see CKD car prices go up by varying degrees (0-20%), depending on the model, although any increases will be gradual in the coming years and would only begin from 2021.
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From promising car price reductions before take over public office, to actually increasing prices. Wow
Mane 30% car Price reduction? Mane?? hahaha
I am also waiting BN’s promise to reduce car prices. From 2013 to 2018 our car prices went highe rand higher. So where is the 30% promise made by BN?
Dulu pun kami kena tipooo.
2017- Honda Accord RM165k
2020- Honda Accord RM200k
Cukur BN tepati janji dulu. PH macam mana? Masih lagi mau naik harga? Pehhh!!!!
https://paultan.org/2018/02/05/have-cars-in-malaysia-become-cheaper-over-the-last-few-years-we-dissect-the-harga-kereta-turun-report/
Zaman BN.
https://paultan.org/2016/04/07/car-prices-to-drop-30-by-2018-prime-ministers-dept/
https://paultan.org/2020/01/17/new-malaysia-excise-duty-regulations-introduced-for-2020-could-see-ckd-car-prices-rise-by-up-to-15/
Zaman PH
jangan tunggu lamalama
Stupid Guan Eng shooting himself in the foot.
This will single handedly kill malaysian automotive industry, like what happened to Australia.
Malaysians always cheated by DRB Honda. In Japan, Honda HRV got Honda Sensing consists of AEB, Blind Spot Monitor, Land Departure Warning, Rear Cross Traffic Alert and etc plus with good car quality and good aftersales service too!
But for DRB Honda, they sells RM108K to RM123K for Honda HRV without Honda Sensing consists of AEB, Blind Spot Monitor, Land Departure Warning, Rear Cross Traffic Alert that you have missed ! Even Honda DRB assembles Honda Models in Melaka with super low quality!
Somemore, still talking about Honda DRB, Malaysians who owned Honda cars, go to service centers and see. After few weeks later or several days later of taking their Honda cars out from service centers, people felt that still having same big problems and always have to spend spend spend for buying parts without problems solved just like buying new smaller A segment car.
Now you know, This is how stupid Malaysians are. And How DRB Honda can protect the people safety lives when DRB Honda Safety is becoming more riskier to the customers.
Honda Malaysia is majority owned by Honda Japan (more than 51%) not DRB. So it not DRB who have the final decision here. Please check your fact before you even speak!
Seriously ?? Honda Japan owns and control 51% of Honda Malaysia. Why are you so butthurt on Honda when many other manufacturers also dont deliver their cars will full safety features. Its not like Honda don’t want to incorporate Honda Sensing into the HRV, the question is, ARE YOU WILLING TO PAY FOR IT ?? its not free….Dumbbell….Its already available for Accord, CRV, Odessey and Civic, yet you don’t mentioned that. Seems you are very biased in your comment. What about Mazda, Nissan, Toyota, Etc, does all their model have safety feature as Honda Sensing?? Please study before commenting…
Looks like Honda Salesman will be more happy and surely will talk badmouth about mazda again.
Wait. Didn’t the government say car prices will drop? Oh wait…
korner sini, korner sana, gostan sini, gostan sana,Utun sini, Utun sana – The Symptom of PH Government
U-Turn sini, U-Turn sana, but no sign of U-Turn in this policy. I think jokers can be a better government than PH
I’m rather confused. Does this mean that CBU prices will go down while CKD prices will go up?
Is this going to affect car brands to shift from CKD to fully CBU? Will it cause them to down scale their installing factories? How will this affect our local economy?
These Japanese Brands from ASEAN could see price hike probably since the import duty is not imposed. But BMW, Hyundai, Mercedes and other carmakers from other Europe will not be price hike which import duty will reduced maybe.
Wa pandai la, so we all know next year car price will increase, they will have good sales this year
hahahah…..no increase heh?
Knowing how the govt works, I am sure there will be other means/venue to squeeze more blood money from rakyat.
Case in point:
Close one toll, open another toll.
Yeah right. Until they UTurn later. This Pakatan UTurn can’t even be trusted to clean my drains or they would start playing in the gutters and not do their jobs.
Even they do nothing is still better than someone stole our money and put into his own pocket.
I rather he steal money and put into his own pocket and he gave us lower car prices, lower petrol prices, lower taxes, lower tolls, BRIM, lower cost of living. At least he steals from the rich and gives back the poor.
Ever heard of Robin Hood? Nobody said he was the bad guy, instead in every book, movie, plays, stories, he is the hero.
Copy paste: “Complete U turn from manifesto .. we don’t want liars in the government . Looks like thief better la”
And nobita said the gov are yet to have agreement on this..
Most likely AFFECTED are the Hign End Cars with Values more than Rm100K. These cars values are extensively “Mark down” to have “reduced” taxes. And have been happening since the last Govn Admin whose “connection” with Finanace Ministry are extensive.
gov should remove all kind tax of the car and fix the car price ( like minyak makan, rice, sugar etc ) for avoid car distributors untung kaw kaw..
U mean the AP holders
Fuh, what a relieve that no increase until year end.
LGE no where to grab money dy
Just get a 1 yrs postponed… After that still the same… Increase again I believed those car maker shall withdraw from ckd in Malaysia already.
Con-lan-firm price increase 1 Jan 2021.
Janji tak di capati. Rakyat di ketepi kan. Minister semua dapat kereta baru. Gaji elaun YB tak turun pun. Syukur Msia Aman.
Actually both the gawmen and car maker’s fault for so high car price. According to reliable sources, a Toyota Avanza inclusive of tax cost RM34k, A Toyota Camry 2.5V cost RM132k including tax and duties. So why car price so high? All go where? To the cronies in John’s UMW and gawmen la.
Toyota Avanza inclusive of tax cost RM34k, A Toyota Camry 2.5V cost RM132k
actually lower than that…actually production cost for car is very dirt cheap.. Avanza only cost rm12k, Camry only rm35k
I said cost of production + Tax & duties bro.
I have the actual figures from import documents of both Toyota Avanza and Toyota Camry 2019 model.