According to the Petrol Dealers Association of Malaysia (PDAM), many petrol dealers may have to cease their operations because of the financial stresses arising from weak fuel prices, as well as weaker traffic due to the government’s movement control order (MCO).
In a report by Bernama, PDAM president Datuk Khairul Annuar Abdul Aziz revealed that petrol dealers have recorded a 70% reduction in sales of fuel products. “Many will have to close soon, there is no more money. It will depend on how much reserve they have. We are not allowed to take unpaid leave; our electricity is still at the same rate. We did not get the 15% rebate, but we are badly affected. It’s going to be tough,” he added.
The 15% rebate mentioned refers to a discount provided by Tenaga Nasional to six selected business sectors directly affected by the Covid-19 pandemic, namely hotel operators, travel and tourism agencies, shopping complexes, convention centres, theme parks, and local airlines offices. The discount was first announced on February 27, and will be given for up to six months from April 1 to September 30.
Last week’s fuel price update saw RON 95 be priced at RM1.44 per litre – a 38 sen drop – while RON 97 went down by 36 sen to RM1.74 per litre. Meanwhile, the price of Euro 2M diesel was also reduced by 12 sen to RM1.75 per litre, with Euro 5 retailing at RM1.85 per litre. The significant price reductions are a result of falling crude oil prices due to an “oil war” among oil-producing countries.
Khairul Annuar said petrol dealers typically have a working capital of only RM200,000 and given the current situation, this could be depleted quickly, which could lead to some not having enough savings to buy fuel. “Everyday we sell. We bought at the (previous) price of RM1.82 (per litre), and then (the pump) price goes down to RM1.44, that’s a 38 sen reduction for RON 95. By a lucky coincidence, sales had been very low when we were selling fuel at a 38 sen loss for a week or so,” he said.
“It’s been three weeks of declining prices, and we have already lost RM40,000 this week, money that’s part of our working capital. At the end of the month we have to pay workers’ wages, and electricity bills of between RM30,000 and RM70,000 (depending on size of petrol station), which is also part of our working capital,” he continued.
The PDAM president repeated the need for price floors to be established for fuel and added that a stabilisation fund is also required to help petrol dealers. “That is what we have been requesting since last week, but they are afraid the people will be angry. I think, one, you should not move that much, and two, the prices are unprecedentedly low now. I am not sure if they were any lower it would be better for the rakyat,” he stated.
“It is better to put a floor (price). Anything extra that the government collects in the stabilisation fund can go towards a subsidy (scheme) when the prices go above the ceiling. A stabilisation fund is a good mechanism,” he explained.
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Strange this call made only because fuel price is down. When price goes up what is the offer in return?? Nothing!!! BTW, whether the price is up or down, petrol dealers still make profit, perhaps less when price is down. Anyway, dealers who want to close, please go ahead. Others are waiting to be dealers. The volume of sales, definitely a lot less now with MCO – less cars moving about so less consumption, but then again, it is not the only industry affected. Almost 80% of other retailers are in the same boat. Once COVID is under control, sales will trend upwards in all sectors, but it will take some time to get back to pre MCO.
Petronas takeover dealers who want to close,
PDAM represents all dealers mate not just those from Petronas.
Even petron also looking to takeover some dealers who want to close too.
Don’t forget, shell are also looking for takeover dealer who want to close too.
they complain sales drop, what about other businesses that have zero sales?
Ceiling to protect citizens, floor to protect petrol dealers. Win-win I guess?
Everybody including artist asked for G’s assistant. When profit time, do you pay taxes accordingly? It is fair if only taxes paid when you are in cloud nine and G will help when you need it. Think about it.
Now with the low oil prices around the world….malaysia petrol dealers whining and no-stop bitching of their financial stresses.
When untung time selling petrol, all petrol station bosses drive luxury cars, live in bungalow, entire family go overseas holiday, khawin 4, enjoy luxurious life, etc.
In the business world, there will be up and down, untung and rugi la.
Well that’s their problem.. When business is down they still want to live life as a T20.. Once in a while they should try living like B40.. Especially now.
If cannot survive than close down the business. These is the free world of demand and supply. When u made high profits during good times did u even think of the poor or needy ones?
A bunch of suckers! Just hand over your licenses to other parties who are more capable than you all kaki tongkat only know to complain evertime the fuel price drop.
I can smell that the petrol price will go down tomorrow. I can smell whenever those PDAM barking here and there and when they said some of their dealers will PADAM soon.
When oil price rises, PDAM never ask for price ceiling. What about us consumer?
Business is never risk free, but they want risk-free environment to satisfy their greed.
And to PDAM, why don’t you create your own stabilisation fund (by collecting contributions from dealers). You know your business is risky, yet you never prepare emergency funds for the tough times.
Best part is when economy is crap and citizens are jobless these cowards have the balls to ask for protection. Same kind of group as the AP clowns.
They are privileged and protekted, so no problem.
podah la…when fuel price increase tak bising pun.
Oh Boo hoo, you’re losing money now just like everyone else in this world.
Close lah, who cares, too many damn petrol stations anyway. I just need 1 or 2 in a 10km radius.
Tutuplah. When price went up 30 sen sure diam jer..
Koloss. they nvr komplen when go cuti oversi to turki, uk, usa, korea.. Sempat lg amik bini muda2
example:
earn RM10K, spend RM8K and take loan RM10K on good days
now earn RM5K need to pay loan installment … sure close shop laa.
verdict: anyhow spend on those good days wont get you far.
It is an essential business… Mangkuk Nasi Emas! if close shop, something very wrong with your financial management.
Just close down lah. Let those who still want to do business remain. If you just want profits only never losses, don’t go into business. I hope Govt revokes the licenses of those who chose to close down and give it to others.
All this while, when the fuel prices are higher, you joli every day… Now when prices plummeted, suddenly got no savings left… :-/
Petrol station owners. Welcome to the real world!
Close it, if you can’t take the heat.
Apart from taxi drivers who always bark when their income koyak, this group also same pattern.
Petrol dealers shame on you!!! although oil prices and MCO was not our doing, show patroism and courage like those in the healthcare and those deciding to stay home.
Well it’s a business choice. But once closed pls revoke the license and it shall not reopen again, at least under the same owner. Sick and tired of all the petrol station complaints. YOU have been reaping all the profits for decades with zero risk. Time to pay back a fraction to the community!!
Or just reduce subsidies
those close license need to be revoke.
if all business is always win, who else want to work
The syndrome of “tongkat” are:
1) complaint to authorities, protest, etc.
2) whining and making noises like big-babies to reporters saying they have been victimized, neglected even after so many years given tongkat, entitlement, etc
3) making various threats of closing down, causing distruption, etc
4) Last resort – buat muka kesian and cry croc tears (show to the world they had mouths to feed, 4 bini to support, loans to pay, eating nasi kicap everyday, etc)
PDAM and petrol dealers have been dreaming lelah air liur for too long. Wake up la.