Malaysia's Energy Efficient Vehicle incentive program

The Malaysian government introduced an Energy Efficient Vehicle incentive program with the aim of improving the automotive industry and provide better incentives for car companies to introduce more fuel efficient cars in Malaysia. The incentive is by way of tax incentives if the models of cars that were introduced complied with the so-called standard of fuel efficiency gazetted by the Malaysian Government. The fuel efficiency standard is not a global standard by one devised by Malaysian Government's advisory body.
Japan has its own domestic fuel efficiency test and so do the Europeans. No one is sure where the fuel efficiency standard figure is obtained from for the Malaysian standard. Many hybrids and European and Japanese vehicles already meet these fuel efficiency standards but not all have benefited from the tax incentive.
All the car makers are aiming to benefit from the tax incentive to reduce the price of cars in Malaysia. It looks like the government is either reluctant to provide the incentives or have no plans to honor it. Thus far only a handful of models have seen any kinds of price reduction benefits. Mercedes Benz's S400 hybrid has been one of the few models that benefited from this scheme but to a limited degree as there is a quota for the benefit. By right such a scheme should be to the benefit for all car makers who have cars that are able to meet the fuel efficiency rating and there should not be any quota. It is as if the govt wants to show it is trying to do some good for the automotive industry by providing such an incentive but on the other hand it is reluctant to honor it. What is the point of mooting such ideas when they don't want to honor it?! this is nothing new in the Malaysian context as it is similar to the Govt pledging to remove the much hated AP (Approved Permit) system where selected businessmen who are linked to the govt are giving import permits for cars. The govt has pledged to remove this AP system for years but this removal deadline has been push back further and further each time saying that the Malaysian Auto industry is not ready for it. The truth in the matter is that only Proton is not ready and the businessmen linked to the govt will lose their benefits. The remainder of the automotive industry is ready and waiting for years for the automotive industry to be opened up.

In 2014 it is the first time in decades where both local car makers Proton and Perodua combined failed to capture more than 50% of the market share. Combined they only managed 46% which is a big drop from 2 years ago. The competition from foreign car makers are getting stronger and the public is sick and tired of buying substandard quality Protons. The one to suffer the most is Proton since Perodua still managed a good slice of the market with its low cost K-cars which serve the masses.

2015 will be an interesting year to see how the automotive industry will fair. There is much speculation that it may contract with the introduction of GST while others believe the prices will drop a little but since the cost of everything will go up, the public may decide to cut spending.