RON95 petrol subsidy rationalisation, EV adoption promotion expected at Budget 2025 tabling – CIMB

RON95 petrol subsidy rationalisation, EV adoption promotion expected at Budget 2025 tabling – CIMB

More details on the implementation of RON 95 petrol subsidy rationalisation are expected to be revealed during the tabling of Budget 2025 on October 18, according to CIMB Securities Research. This echoes what was mentioned by RHB Investment Bank just a few days ago.

In addition to RON 95 petrol subsidy rationalisation, CIMB Securities Research also expects the government to continue promoting electric vehicle (EV) adoption, The Star reports. Both initiatives are said to have an effect on vehicles sales moving forward into 2025.

The research house anticipates total industry volume (TIV) in the fourth quarter of 2024 to be “softer” due to the government’s plan to rationalise fuel subsidies. However, it noted that the introduction of the Employees’ Provident Fund (EPF) Account 3 and salary hikes for civil servants could bolster new vehicle sales.

RON95 petrol subsidy rationalisation, EV adoption promotion expected at Budget 2025 tabling – CIMB

While the Malaysian Automotive Association (MAA) anticipates TIV for 2024 to be 765,000 units (revised from 740,000 units), the research house is cautious and expects the figure to be at 751,000 units. It cited the absence of sales tax exemptions, potential higher RON 95 costs and increased competition from premium EVs and Chinese original equipment manufacturers as key factors.

The anticipated fuel subsidy rationalisation could also add inflationary pressure to further dampen consumer sentiment. The removal of the diesel subsidy on June 10 this year has resulted in weaker commercial vehicle sales, with the MAA revising its forecast from 74,000 units to 68,850 units.

Additionally, the tightening liquidity in the financial sector, which has seen in a dip in hire purchase loan approval rates to 58.1% in the first seven months of 2024, may also impact demand. On the matter of EV adoption, the research house said it expects the government to continue offering tax reliefs and rebates to individuals and investments in new EV infrastructure.

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Gerard Lye

Originating from the corporate world with a background in finance and economics, Gerard's strong love for cars led him to take the plunge into the automotive media industry. It was only then did he realise that there are more things to a car than just horsepower count.

 

Comments

  • EV or not EV, if categorises as luxury vehicles, should be tax. And anyways, aside that, we don’t need so much of vehicles, as already too many cars on the road and traffic is everywhere

    Like or Dislike: Thumb up 12 Thumb down 4
    • Dah Menang Semua on Oct 01, 2024 at 5:55 pm

      Very funny…
      Where those staying
      PPR, Apartment, Condo
      Going to charge their cars?

      Like or Dislike: Thumb up 4 Thumb down 0
  • 4GR-FSE on Oct 01, 2024 at 10:13 am

    With the strengthening of the Ringgit, and dropping of oil price over the last 1 year, I think the government will start the RON95 rationalization since the gap between subsidized and unsubsidized oil price will be smaller compared to few months ago. The impact will be mitigated by strengthening the Ringgit further hopefully next year. Better do it soon and not until election year if the Madani gov. wants to survive for another term..

    Like or Dislike: Thumb up 9 Thumb down 2
    • anwar menang, rakyat dikencingkan on Oct 02, 2024 at 7:14 pm

      Should they survive another term?

      Like or Dislike: Thumb up 0 Thumb down 0
  • Should tax the rich since high value good tax is coming anytime

    Like or Dislike: Thumb up 5 Thumb down 1
  • TinKosong on Oct 01, 2024 at 11:24 am

    EV with Zero tax?

    Like or Dislike: Thumb up 1 Thumb down 0
    • PH janji kereta murah mana? on Oct 02, 2024 at 12:46 pm

      This shit gomen is only for the rich. The poor will be strangled until dead.

      Like or Dislike: Thumb up 5 Thumb down 0
  • Rakyat Malaysia on Oct 01, 2024 at 11:49 am

    Removing petrol subsidy = robbing from the poor
    EV incentives = giving to the rich
    So PH Gomen is Robbing from the poor & giving to the rich

    Is this a fair & just Gomen that rakyat voted? Hell no!!!

    Like or Dislike: Thumb up 19 Thumb down 11
    • 4GR-FSE on Oct 01, 2024 at 2:19 pm

      The Subsidy rationalization will still offer cash hands out to the poor, just like diesel through Budi Madani.
      For the rich, at least if they are not happy with unsubsidized petrol, they have the option to move to EVs.
      Anyway, the rich have paid way much more income tax than the poor that pays nothing. The duty and tax on cars are way lesser than what the rich have paid in income tax in a year..

      Like or Dislike: Thumb up 10 Thumb down 15
      • Make Malaysia Great Again on Oct 02, 2024 at 10:36 am

        Unlike Najib BR1M this PMX Madani money sum is pitiful and not enough to cover the price hikes that businesses will leverage onto the rakyat. So in effect the subsidy rationalisation will be a double hit on the rakyat as we need to pay for inflation and price hikes while the targeted businesses get no hit or even more profits as this allowed them to hike even higher margins. Like the upping sugar tax RM 1.00 per kg but kopitiams charging extra 20sen per cup of coffee so who actually benefits from this rationalisation?

        We voted this gomen to keep our subsidies and if they are not gonna do as they promised, then its time to change a new one that will.

        Like or Dislike: Thumb up 14 Thumb down 0
      • Plain BS on Oct 02, 2024 at 12:44 pm

        Dude, do you even see what is wrong with your statement?
        The rich has option for EV when they are not happy with unsubsidised fuel.
        The poor has NO OPTION AT ALL. They can only downgrade to kapcai but that also uses unsubsidised petrol.
        So the rich could escape but the poor are still screwed by Madani.

        Like or Dislike: Thumb up 5 Thumb down 0
  • Eclipse on Oct 01, 2024 at 12:21 pm

    Looks good!!!

    Like or Dislike: Thumb up 0 Thumb down 0
  • Janji Dicapati on Oct 01, 2024 at 12:49 pm

    Refer my name

    Like or Dislike: Thumb up 7 Thumb down 0
  • Nurul Izzah on Oct 01, 2024 at 12:49 pm

    Anwar menang rakyat senang

    Like or Dislike: Thumb up 3 Thumb down 4
    • Sick & Tired on Oct 02, 2024 at 12:47 pm

      Only rakyat kaya senang, rakyat marhaen merana & sengsara.

      Like or Dislike: Thumb up 1 Thumb down 0
  • Fixie on Oct 01, 2024 at 8:18 pm

    Nice one. Coming from a PM that supposedly cares so much about the poor. He wants to take out subsidy which would hit the poor the most and give that subsidy to the rich people. What a load of boloney. At least be honest of your true color Anwar.

    Like or Dislike: Thumb up 7 Thumb down 0
  • Masakroti on Oct 02, 2024 at 12:08 pm

    This EV push is getting ridiculous. No b40 can afford it anyway

    Like or Dislike: Thumb up 5 Thumb down 0
  • lolipop on Oct 02, 2024 at 6:03 pm

    gov cannot tax the rich more because the rich will have more reason to charge the poor more, remember that they do business. Also when their business failed they too becomes poor, gets more gov aid. (no income = poor according to malaysian, even with lots of assets)

    Like or Dislike: Thumb up 0 Thumb down 0
  • AbuNON on Oct 03, 2024 at 12:42 am

    Sy Ulang!!! Bkn sebulan, bkn seminggu… menang hari nie esok dlm masa 24 Jam

    Like or Dislike: Thumb up 0 Thumb down 0
 

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