Automobile Industry of Malaysia

AUTOMOBILE INDUSTRY OF MALAYSIA Malaysia's Auto Industry: An Economic Safety Net Prime Minister Mahathir prizes development of an indigenous auto industry as his pet project. He has sought to develop the auto sector to avoid a huge trade deficit and to reduce the effects of volatile changes in rubber and palm oil prices on the economy and promoted the sector to help speed recovery from the Asian economic crisis. The Malaysian government also believes that …

…the tariff for completely built up cars with a cylinder capacity exceeding 3,000 cc currently stands at 300 percent. The 2002 budget also halved the expected revenue from import duties on large capacity motorcycles. Local press reports suggest that Malaysia is likely to reduce tariffs on commercial vehicles and four-wheel drive vehicles "as a sign of its commitment to AFTA." Since these tariffs are already 5 to 10 percent any reduction is unlikely to have an impact on local industry.