tag:blogger.com,1999:blog-6297413898275266606.post1973898026135040783..comments2024-03-27T18:15:59.096+08:00Comments on Economics Malaysia: How Much Would Car Prices Come Down If Excise Duties Were Abolished?hishamhhttp://www.blogger.com/profile/06265308095732759923noreply@blogger.comBlogger28125tag:blogger.com,1999:blog-6297413898275266606.post-75161854429669856592014-06-02T23:13:18.209+08:002014-06-02T23:13:18.209+08:00I enjoyed reading your articles. This is truly a g...I enjoyed reading your articles. This is truly a great read for me.I have bookmarked it and I am looking forward to reading new articles.<br />To get new information visit here <br /><a href="http://motorcaradvisor.com/" rel="nofollow">buying a new car</a>Rahamtul Barihttps://www.blogger.com/profile/05897691841982066001noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-63690606604897404862014-02-26T17:38:53.265+08:002014-02-26T17:38:53.265+08:00Nice topics & article posted on blog. I like t...Nice topics & article posted on blog. I like these tips. This is great and important elements in the modern world that mean <a href="http://easycarfinder.com.au/" rel="nofollow">used car prices</a>. I have always wanted to know where all the yummy Vegan places were and now i can easily eat out at these place or order in! thanks so much! Anonymoushttps://www.blogger.com/profile/01360130344517787454noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-66217695005687015382014-01-22T15:19:41.863+08:002014-01-22T15:19:41.863+08:00Hi Yang,
I'm not sure what I can contribute, ...Hi Yang,<br /><br />I'm not sure what I can contribute, as I'm not a microeconomics specialist. But email me if you're still interested econsmalaysia@gmail.comhishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-29483713165003074462014-01-22T11:08:19.829+08:002014-01-22T11:08:19.829+08:00Hi Hishamh
My name is Yang and I am an analyst co...Hi Hishamh<br /><br />My name is Yang and I am an analyst covering the automotive industry. i am given a task to conduct an analysis of the 2014 NAP. would be great if i could buy you coffee and meet up. thanks<br />Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-12729150443161981192013-06-19T17:17:48.762+08:002013-06-19T17:17:48.762+08:00@Ladybug
Precisely!!@Ladybug<br /><br />Precisely!!hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-7844020700514096562013-06-19T17:10:23.914+08:002013-06-19T17:10:23.914+08:00Isn't this an asymmetric information problem? ...Isn't this an asymmetric information problem? i.e. consumers don't really know how much of the cost they are paying for their cars really go into paying taxes thus manufacturers/distributors have an incentive to put a premium on branding? Apparently EBIT margin for automotive segments in UMW is at abt 17% while proton's EBIT margin is below 5%. So they are essentially riding the Ladybughttps://www.blogger.com/profile/14759371764256966555noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-55972150943881394022013-06-18T16:10:26.868+08:002013-06-18T16:10:26.868+08:00@yauwenchin
I wish I could - But the reason why I...@yauwenchin<br /><br />I wish I could - But the reason why I can't and why there is so much confusion over the level of excise duties is because the specific numbers for each model under each brand is not publicly available.hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-23867917130465187642013-06-18T15:25:50.749+08:002013-06-18T15:25:50.749+08:00Instead of explaining it in such a macro way, why ...Instead of explaining it in such a macro way, why don't we explained it in a simple way where layman can understand it and useful for them to make decision. Example, if we buy a Toyota Camry 2.0 today in Thai, it is about RM110,000 and in Malaysia is about RM140,000. Then go line by line, what have cause the difference. And conclude, how much excise duty do we actually paid for Toyota yauwenchinhttps://www.blogger.com/profile/04826275608822769132noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-24650717070614109642013-06-18T14:13:26.757+08:002013-06-18T14:13:26.757+08:00aetherfox,
Absolutely agree - if the market was r...aetherfox,<br /><br />Absolutely agree - if the market was really competitive, prices wouldn't stick so high for so long. Even without Proton, there's just too few players and even fewer distributors locally, to think that market forces will move any faster than a snail's pace.hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-71144801225790088972013-06-17T11:30:55.094+08:002013-06-17T11:30:55.094+08:00My economics is really outdated but I do work in t...My economics is really outdated but I do work in the automotive sector, but there are countries with higher level of vehicle pricing (like Australia) even without tariffs or taxes, it's purely demand side - high wages mean that the same car costs about 30% more than it does in the US. It's the lack of competition (and general collusion among manufacturers) and large disposable income thataetherfoxhttps://www.blogger.com/profile/01845828832281548307noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-82287078145798079562013-06-17T09:17:16.626+08:002013-06-17T09:17:16.626+08:00@anon 5.45
Absolutely, calculating the average ce...@anon 5.45<br /><br />Absolutely, calculating the average certainly obscures the different tax burdens on specific cars. On the other hand, the average I've calculated is a lot more informative than assuming car prices could be cut by 40% just by abolishing excise duty.hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-449149419501512622013-06-17T09:15:11.151+08:002013-06-17T09:15:11.151+08:00@anon 86
1. Import and excise duty exemption only...@anon 86<br /><br />1. Import and excise duty exemption only applies to hybrids below 2000cc, and they still attract sales tax of 10%.<br /><br />2. Non-hybrid CBUs (and especially those from outside ASEAN) attract the full weight of import (30%) and excise duty (80%-105%), especially for cars above 1800cc. I don't think you can generalise from these examples to the entire market.hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-48806474958522229222013-06-17T08:59:15.566+08:002013-06-17T08:59:15.566+08:00@Living Seed,
Agreed; production volumes and frag...@Living Seed,<br /><br />Agreed; production volumes and fragmentation of production would certainly play a role in embedding inefficiency in car pricing. However, the sales figures on manufacturing output suggest this is at worse a minor caontributing factor.hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-16479515449244736912013-06-17T08:54:34.930+08:002013-06-17T08:54:34.930+08:00@Mac
Don't apologise! We're all trying to...@Mac<br /><br />Don't apologise! We're all trying to figure out the truth, and any constructive criticism is welcome.<br /><br />Proton (and Perodua and Naza) all pay the same excise duties as everybody else, where the rate is subject to the source of the parts they put into their cars. If the national car brands pay lower duties, it's only because they have slightly higher local hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-10190869806116783732013-06-17T08:41:10.722+08:002013-06-17T08:41:10.722+08:00@Morty,
His figures approximate that which I tabu...@Morty,<br /><br />His figures approximate that which I tabulated in the fifth paragraph in the blog post above i.e. the assumption that excise duty is levied at the full rate, and there is no margin on distribution.hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-72037330433060417162013-06-17T08:39:55.067+08:002013-06-17T08:39:55.067+08:00@Living Seed,
The reduction in import duties thro...@Living Seed,<br /><br />The reduction in import duties through AFTA has already been in effect since 2005, IRIC.hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-71009229318834643902013-06-17T08:37:25.548+08:002013-06-17T08:37:25.548+08:00@anon 1.39
Agreed, all good points.@anon 1.39<br /><br />Agreed, all good points.hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-47864534554627389712013-06-16T21:39:34.984+08:002013-06-16T21:39:34.984+08:00The latest Proton Saga SV shows some good move by ...The latest Proton Saga SV shows some good move by Proton when comparing the price between SV vs FLX Standard which is estimate 5K different but have more accessories in it. <br /><br />But I'm hoping for non-national cars to join the price drop as well. Alexhttp://malaysiacreditcard.com/noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-42973092321826166272013-06-16T17:45:55.276+08:002013-06-16T17:45:55.276+08:00Salam Hisham,
With due respect, I think the avera...Salam Hisham,<br /><br />With due respect, I think the averaging out of the excise duty reduction creates a skewed picture. The reduction would lead to significant falls in foreign car prices, as you have pointed out, and I think this would by extension lead to more customer choice and competition in the market. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-66008327033137836302013-06-16T14:51:29.225+08:002013-06-16T14:51:29.225+08:00Hi Hisham, you may have forgotten that the hybrid ...Hi Hisham, you may have forgotten that the hybrid tax rebates in the past few years allows an interesting UNSCIENTIFIC case study which may disprove your theory in relation to the effect of taxes on imported CBU cars.<br /><br />Taking UK prices into consideration:-<br /><br />HYBRID CARS<br /><br />1. Toyota Prius<br />UK Price = ~ RM 107000; Msia price = RM 140000<br />Verdict: Msia 30% more Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-10052794438971623822013-06-16T08:48:46.419+08:002013-06-16T08:48:46.419+08:00i think Diseconomies of Scale also contribute to t...i think Diseconomies of Scale also contribute to the highest car priceLiving Seedhttps://www.blogger.com/profile/08517391429116553990noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-60070217929146332532013-06-15T12:05:44.242+08:002013-06-15T12:05:44.242+08:00Interesting. But doesnt the average car sales data...Interesting. But doesnt the average car sales data u have used here include proton which i assume wud enjoy lower rates? Shouldnt u exclude the proton cars to estimate the average excise duty for importes cars? I have yet to look at the data u hv used in detail and so my comment here might be irrelevant and in which case i apologise.Machttps://www.blogger.com/profile/02890011033915465870noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-48714702766664724672013-06-15T07:25:25.126+08:002013-06-15T07:25:25.126+08:00But PKR Rafizi promises to abolish car duties and ...But PKR Rafizi promises to abolish car duties and we can all drive to work. How does your figure tally with his?Mortynoreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-38376870822071247152013-06-15T05:04:19.630+08:002013-06-15T05:04:19.630+08:001 question,by imposing AFTA, how much % will be r...1 question,by imposing AFTA, how much % will be reduce the prices of car??Living Seedhttps://www.blogger.com/profile/08517391429116553990noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-35538997209442509812013-06-15T01:39:12.196+08:002013-06-15T01:39:12.196+08:00Agree abolishing excise duty will not do much in r...Agree abolishing excise duty will not do much in reducing car prices. The most I think is 10%. The largest contributors to retail prices are still import duty on CKD parts and components (30 - 50%) and CBU cars (197 - 297%)from outside Asean, and distribution.Anonymousnoreply@blogger.com