Thursday 28 Mar 2024
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This article first appeared in The Edge Financial Daily on June 14, 2018

SHAH ALAM: The transport ministry is considering reviving the cash-for-clunkers programme — a cash rebate system to reduce the number of old cars on the road, said its minister Anthony Loke Siew Fook.

The ministry will need to consider issues such as funding mechanism and implementation method before rolling out the programme, as it “could bring about many implications”, said Loke.

“There is no decision made on this as yet, but I have been briefed by my officers that there are some plans related to this,” Loke told reporters after visiting Plus Malaysia Bhd headquarters to observe traffic flow along the North-South Expressway (NSE) ahead of the Hari Raya Aidilfitri holiday.

The cash-for-clunkers is a term for a government-driven rebate system to scrap old cars on the road. Under the initiative, car owners will be given a cash voucher to trade in old cars — usually more than 10 years old — for new ones.

According to data from MIDF Amanah Investment Bank Bhd in a January 2016 note, there is a massive number of old cars on Malaysian roads, where nearly six million cars, equivalent to 49% of existing cars on the road, are above 10 years of age.

In April this year, it was reported that Proton Edar Dealers Association Malaysia is urging the government to scrap old vehicles to boost vehicle sales and grow the automotive sector.

The association wants the government to pursue the Vehicle End of Life policy, first brought up in 2009 which, upon proposal, required vehicles 15 years or more to undergo mandatory annual check-ups before road tax renewal. Failing to pass the inspection means the vehicles will have to be repaired until they pass the inspection.

Scheduled to be put in place in 2014, the policy was shelved after a public outcry. In 2015, the Malaysia Automotive Institute suggested the policy be changed to the cash-for-clunkers scheme.

Last year, the then transport minister Datuk Seri Liow Tiong Lai said a study on the policy was at its final stage.

If implemented, analysts said the cash-for-clunkers programme could stimulate demand for new cars and reinvigorate the country’s softening annual car sales, while indirectly enhance vehicle users’ safety.

The last time such a scheme was implemented locally was in 2009, when Proton Holdings Bhd — through its Proton Xchange programme — offered a cash rebate of RM5,000 for cars more than 10 years old in exchange for a new Proton Saga or Persona. The scheme was discontinued at the end of that year.

Separately, Loke said PLUS is expecting between 1.9 million and 2.2 million cars on seven expressways, particularly on the 784km NSE, during the Hari Raya period.

“We are seeing more cars on our roads in conjunction with the ‘balik kampung’ galore by motorists, as well as a 50% discount [that was offered] on toll roads in two days, starting yesterday (Tuesday),” he added.

During the festive period, Loke said heavy vehicles more than 7,500kg will be banned from the roads, while selected lorries will be allowed at certain hours. “This is to prevent extreme congestion on the roads, due to high volume.”

As for implementing a new child seat law, Loke said the government had yet to decide on the matter. “We are studying this but the law, for now, has not been enforced.”

Currently, Loke said there are 150 cameras on the NSE — equivalent to around a camera per 10km — to monitor traffic conditions. “We are watching motorists’ movements and we are ready to catch those who violate the traffic law.”

Since the government launched the 13th Ops Selamat last Friday, Loke said the Road Transport Department had issued 11,782 summonses related to various traffic offences.

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