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Published: Wednesday October 24, 2012 MYT 12:57:00 PM
Updated: Wednesday October 24, 2012 MYT 1:12:16 PM

Mustapa: No plans for cash rebate as incentive to buy electric and hybrid cars

By RAHIMY RAHIM


KUALA LUMPUR: The Government does not plan on cash rebates as an incentive to buy energy-efficient vehicles (EEV) similar to that implemented in the United States or other European countries, Parliament heard Wednesday.

International Trade and Industry Minister Datuk Seri Mustapa Mohamed said such a subsidy to attract buyers to purchase electric cars would cost a lot of funds, which will be taken from other ministries.

"Currently, to attract consumers, the Government has lifted the import duties for EEV while major car companies were given incentives to draw them to set up their manufacturing operations locally," he told Datuk Ismail Kassim (BN-Arau) during Question Time.

Ismail had asked whether the Government would consider handing out cash rebates like in the US or European countries to attract more people to buy EEV or hybrid vehicles.

Mustapa said the incentives given by the Government to major companies had attracted companies such as Honda, which recently set up an EEV factory in Malacca, attracting some RM1bil worth of investments.

"The new factory enabled 1,000 new job opportunities for the locals as well as the production of some 50,000 EEV assembled locally to be sold locally and to other Asean countries," he said.

He also noted that the reduction of import car excise duty needed to be studied carefully to avoid any negative implications to the economy.

"We believe that the vehicle ownership cost is still considered cheap compared with other Asean countries if we take consideration of other factors such as oil and gas subsidies, maintenance costs, insurance and others.

"We must also look into the impact on used car dealers, public transportation as well as congestion problems before we consider reducing the import duty," he told Datuk Saifuddin Nasution Ismail (PKR-Machang), who asked whether the Government intended to reduce the excise duty for cars.

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