RAWANG, Malaysia -- Malaysian carmakers, stung by falling demand, were left uncertain over future car prices as the government reiterated its intent to slash high auto import duties without saying what non-tariff duties will be brought in to make up for lost revenue.
International Trade and Industry Minister Rafidah Aziz said Malaysia, Southeast Asia's largest auto market, will levy other charges on new car sales but brushed over the timing and the likely scale of the changes.
She said the country was on track to bring tariffs down to levels on par with the rest of its Association of South East Asain Nations (ASEAN) from January 1, 2005.
"At this point in time, it is immaterial as to by how much and when tariff restructuring will be undertaken," she said.
Rafidah said ASEAN Free Trade Area (AFTA) goals were being respected.
"The reality of the AFTA marketplace is there," she said.
Auto makers in Malaysia are grumbling that delays in releasing details of the new duty structure were costing them as consumers hold back purchases.
Vehicle registration figures in Malaysia fell 38 percent to 20,199 in February from 32,403 in January. The Malaysian Automotive Association said earlier this year sales growth was expected to slow this year partly because hopes of lower prices for new cars discouraged buying.
The minister was speaking at a function to mark the five thousandth unit of Perodua Kancil car at a plant north of Kuala Lumpur.
Perodua and rival Proton are Malaysia's two national cars. Malaysia protects its national car industry with duties as high as 300 percent on imported vehicles.
The country won a controversial two-year opt out until 2005 from car import tariff cuts agreed by the 10-member Association of the Southeast Asian Nations (ASEAN). ASEAN groups the countries of Singapore, Indonesia, Brunei, Malaysia, Philippines, Thailand, Myanmar, Cambodia, Vietnam and Laos.
Foreign car makers and Malaysia's ASEAN partners were disgruntled with the waiver, which Kuala Lumpur said was essential to allow Proton time to prepare for liberalization.
Proton, Malaysia's best-seller with a 60 percent share of the market, would have a hard time competing against tariff-free ASEAN imports.
Malaysians are hoping car prices will drop once the country joins AFTA, although the government has warned that new taxes might replace existing import tariffs.
Top global carmakers such as General Motors, Ford, BMW and Daimler Chrysler set up bases in Thailand to take advantage of the Malaysian market after 2005.
Perodua is 38 percent controlled by Malaysia's UMW Holdings. Daihatsu Motor Corp., a unit of Toyota Motor Corp., and Mitsui own a combined 28.4 percent in Perodua.