Automotive component manufacturers have urged the government to defer the implementation of the revised electricity tariff surcharge for medium voltage (MV) and high voltage (HV) industrial users that is set to come into effect on January 1, 2023. They said that the upward revision by more than 566% to between 20 sen and 27.7 sen/kWh from the 3.7 sen/kWh currently was too sudden and dramatic, Bernama reports.
Speaking on behalf of the Proton Vendors Association (PVA), Toyota Suppliers Club (TSC), Honda Malaysia Suppliers Club (HMSC) and the Malaysian Automotive Component Parts Manufacturers Association (MACPMA), Perodua Suppliers Association (P2SA) president Helmi Sheikh Mahmood said in a statement that the increase will have “a profound impact” on every industry, regardless of size.
He said that while the group of automotive component manufacturers understands the government’s intentions to remove subsidies from MV and HV industrial users as a way to mitigate the impact of increased coal prices, the soon-to-be-implemented tariff, coupled with increased minimum wage brought about by the recently revised Employment Act 1955 (Amended 2022), would prove difficult for the companies to work around, cost-wise.
Helmi said that the rise in the minimum wage level by 25% from RM1,200 to RM1,500, coupled with reduction of weekly work hours from 48 hours to 45 hours as well as increasing the threshold of those who are entitled to overtime compensation, had already increased overhead costs considerably.
“These two factors would be too heavy for us to absorb and as a result, the industry will have to pass these costs on to customers. This would have a devastating impact on the automotive industry, as it would result in a massive increase in vehicle prices,” he stated.
“We too wish to serve Malaysia and we kindly ask the government to delay the increase in power tariffs and work with us to ensure that any changes, with regard to policies, laws, taxes, incentives, tariffs or other initiatives, will have the desired effect,” he added.
Earlier this month, prime minister Datuk Seri Anwar Ibrahim said that an electricity price hike was inevitable, stating that there would be a continued impact on the government’s finances if nothing was done. He said that while households and SMEs will not be subjected to any hike in electricity tariffs, multinational and large export-oriented companies would have to pay more for their electricity.
“The current tariffs are too low for them, and the subsidy should not be given to the large companies that make high profits,” Anwar said.
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Automotive companies are so kind, they want to serve Malaysia and don’t want to pass the increased cost to us the rakyat. Where to find kind companies like these?
Dear government,
Please also remove AP and taxes for excise duties and import duties, then everyone can buy foreign cars. Foreign cars have been tax because of protectionism for proton and perodua. But it is better to jack up the prices for proton and perodua, that will be better.
Please also reduce fuel prices for everyone
We all had a feeling this was coming. Vote with your wallets folks since rakyat mandate got stolen. This cannot continue.
You mean rakyat mandate was stolen which is mostly by PN? Which do you think can’t continue? Either PN or PH with unity government? Please think about it, you seems you don’t read so much on politics. And so what, who cares on what you said. No one will care about PN, besides PN stole people mandate that we voted for PH in GE14, PN are also sleepy and really more scary if PN continues leading
Now that Price Hike is Gomen habeslah Malaysia!
Its ok, if the car prices are high, as long as PH is in power, rakyat will be happy. Lol, we got scammed big time here if everything goes up.
Build your own power station
“multinational and large export-oriented companies would have to pay more for their electricity.”
Meaning charging stations for EV’s from Shell, Petronas, etc. will become 25% more expensive?
This is what happens when u invest ZERO RM in renewable energy and automation. Any increase in tariff or minimum pay will increase costs.
What makes you think that “renewable energy” is cheaper? Germany for example (where wind turbines are popular) has the second-highest electricity tariffs from all countries (around 10 times higher than in the US)?
Hahaha! This is what happens when you’re uneducated and want to comment! Don’t know your place?
What makes them special compared to every other industry? Every high voltage industrial user will feel the pinch. Building material and finished goods already increased in prices this year already and will just keep increase. Min wage is still very low but we are still in a labour shortage situation. It’s public knowledge that oil prices and energy generation costs are high this year.
If we keep subsidizing them they’ll just not change, and already subsidized a lot during 2 years of MCO.
I hope they actually carry out their words, if they so publicly want to threaten to raise prices if tariffs go up. Can’t wait till all the CKD A and B segment car prices go up so everyone can finally see how stupid our excise duty/import tax is as well.
Dear government,
Please also remove AP and taxes for excise duties and import duties, then everyone can buy foreign cars. Foreign cars have been tax because of protectionism for proton and perodua. But it is better to jack up the prices for proton and perodua, that will be better.
Please also reduce fuel prices for everyone
TNB writes:
‘“MEDIUM VOLTAGE” in the context of tariff classification means a supply voltage
from 6,600 volts to 66,000 volts.
“HIGH VOLTAGE” in the context of tariff classification means a supply voltage of
132,000 volts and above.’
I don’t know any automotive component manufacturer who needs 6,600 volts or 132,000 volts and above? The pictured machinery runs on 3x400V?
Or do the companies have their own transformers from high/medium to low voltage (3x400V)?
Any TNB engineer here who can enlighten me?
I realised people here seem to think that by removing AP or whatever taxes, then cars will become more affordable and everyone can afford Japanese cars instead! What makes people think Japanese companies won’t maintain or even increase their prices instead? Who would want to make less money when there is opportunity to make even more? Readers here need to acquire logical and critical thinking. That’s going to be hard given the state of Malaysia’s spoon or hand or chopstick fed education system!
And what makes people think that if price still expensive and end up have to buy national cars, is that what you want? Who would want to make more logical to buy national car but poor spare parts but lots of problems. Readers will hear will be acquire logical and critical thinking on why many wants foreign cars instead of national cars, unlike you. People who are smart in education unlike you
There are so many ways that they can do lah. Increase the use of solar panel to reduce the bill by TNB, then tariff will be greatly reduced.
Also, time has change. Younger generation wants freedom (meaning more time for their family and able to do other things). Since there are increase of labour prices, can always JV with other companies for technology sharing. There are alternatives where we can go on the automation route since cheap labour is hard to come by anyways.
So many excuses made. Why don’t these people unite and do some JV on technological and OEM sharing. Big boss wants to profit, but complain labour are expensive. These so called labours contribute most of the income to the company. Without them, then become boss also no point. Have some balls and be a man!