Allowing Import Of CBU Cars With Small Engine Capacity Will Hurt Local Industry

Liew Chin Tong, the deputy minister of investment, trade, and industry, stated that permitting the import of completely built-up (CBU) cars with small engine capacities will result in the dumping of such vehicles in the local market and undermine the government's goal of developing the local automotive industry.

Regardless of the brand or engine capacity of the vehicle, Liew stated that the local automotive industry roadmap is focused on promoting local assembly activities by national automakers and OEM businesses.

He was responding to a question from senator Seruandi Saad regarding the government's willingness to review the import permit requirements and standard operating procedures for the entry of cars with low horsepower such as 660cc.

According to him, the National Automotive Policy 2020's objective would be hampered if original equipment manufacturer (OEM) businesses began importing CBU cars instead of producing cars locally.

He further added that the importing of small engine capacities will impact national and OEM automakers' long-term investment planning for local production.

“This will affect local vendor development efforts and lead to the loss of employment opportunities for locals in the future,” he said.

“Having a small engine capacity does not necessarily mean a particular vehicle will be sold at a cheap price, as imports are still subject to import tax, excise duty and sales tax,” he added.