Demand For Diesel-Powered Vehicles Will Remain Strong Despite Subsidy Rationalisation - Sime Darby

Despite the rationalization of the diesel subsidy that went into effect on June 1 of this year, Sime Darby Bhd anticipates that demand for the diesel-powered vehicles in its portfolio, particularly the Toyota Hilux, will continue to be strong, The Edge has reported.

According to Group Chief Financial Officer Muhammad Noor Abd Aziz, the commercial sector will continue to need these vehicles for work deliveries, so supply will keep up. He claimed that the market was now "more exciting" since the diesel subsidy rationalization was implemented.

According to the preliminary information gleaned from its Ford and Toyota divisions, he said, there was a response from customers who took a wait-and-see attitude. "But we expect the demand to continue to be strong especially for the Hilux," he stated. On June 1, 2024, the government eliminated its diesel subsidies, a necessary step to reduce diesel smuggling and to lower the rapidly rising diesel subsidy bill, which was expected to reach RM14.3 billion in 2023 (up from RM1.4 billion in 2019).

In Peninsular Malaysia, where the change is implemented, prices went up from RM2.15 to RM3.35, a 56 percent increase.