AUTOMOTIVE INDUSTRY: Driven to despair over costs
IT cannot be denied that for a young urban executive, the biggest debt would probably be his transportation cost: car payments, petrol, insurance and road tax.
That may take up to 50 per cent of his salary. This is because local manufacturers cannot produce cost-efficient cars.
It is also because greed has taken hold of the auto industry. The consumers are again made victims of the auto industry’s inefficiency.
In Malaysia, the national cars have to be protected by taxing non-national cars, resulting in Malaysians choosing the former. Consumers are being forced to pay excessive prices for non-national cars.
When will we have the right to choose the best product and best value for money in the market?
It looks like local cars have to be continuously nursed and protected. And if this is not enough, the industry is against the responsible lending guidelines of Bank Negara.
It seems that they are not in the least concerned about the suffering it causes consumers, when they purchase beyond their means.
For them, the only concern is how many cars they can sell and how much profit they can make.
The Federation of Malaysian Consumers Association considers the guidelines on responsible lending that cover suitability and affordability assessment of potential borrowers, market disclosure and debt recovery as being reasonable and fair, especially in the context of the increasing number of young workers getting into financial trouble.
The decline in the number of cars being sold might even be a good sign: that more people are switching to public transport.
Fomca stands by Bank Negara on the responsible lending guidelines. If consumers are being ripped off by over-priced cars, at least they should have protection through responsible lending practices of banks. We urge Bank Negara to stand firm.