Saturday, April 13, 2013

Car prices cannot be reduced abruptly

The prices of cars cannot be reduced abruptly as they will affect the overall car industry, said former chief executive officer of Proton Holdings Bhd, Datuk Seri Syed Zainal Abidin Syed Mohd Tahir.

Syed Zainal said several important factors had to be considered before the prices could be reduced.

"In my view, the reductions can be done but they must be studied thoroughly and various aspects have to be taken into consideration.

"Many stakeholders are involved because this not a small industry but a big one involving many investors," he said when met here today.

He said this when commenting on the government's efforts to reduce the car prices gradually and Pakatan Rakyat's manifesto calling for a quick cut.

Syed Zainal said the prices could be reduced in stages but must considered several important factors like the effects on the used car market and car parts makers.

He said not only the carmakers would be affected but also the parts makers if the car prices were reduced abruptly.

"We have to also ensure that the economy is strong and the car market stable and sustainable in the long run," he said.

Syed Zainal said when the car prices were reduced by five per cent last year, the market for used cars fell by 10 per cent.

"If we do not take into consideration the used car market, the situation will be serious which will affect the economy and the car industry itself," he said.

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