Proton complains of dumping

Proton complains of dumping

Agence France-Presse, Kuala Lumpur

Malaysian national carmaker Proton has complained that foreign
cars are being "dumped" in the domestic market at below their
true value, amid a slump in national car sales, a report said on
Wednesday.

Proton's chief executive Mahaleel Ariff was quoted by the
Bernama news agency as saying that such "product dumping will
affect the market."

He did not elaborate on his remarks but the Proton Edgar
Dealers' Association (PEDA), which groups national car dealers,
said some imported cars were being sold in Malaysia at 20-50
percent below their true value.

PEDA president Wan Ahmad Sepwan Wan Abdul Rahman told Bernama
he had received information that the cost, insurance and
transport of some Korean-made cars were under-declared in order
to secure a lower price tag.

"With such a declaration, a lower tax is imposed and this
enables the distributor to give discounts to customers," he said.

Deputy Prime Minister Najib Razak said over the weekend the
government would give serious attention to the issue of dumping
by foreign carmakers in Malaysia because it could lead to
unhealthy competition.

Malaysia's top two state-backed national carmakers, Proton and
Perodua, jointly control more than 70 percent of the domestic
auto market.

However, they face increasing pressure from Japanese and
Korean carmakers as the auto market gradually liberalizes under a
regional free trade pact.

Last year, Proton's market share dropped to 44 percent from 48
percent in 2003, while Perodua's share dropped to 30 percent from
35 percent.

The government, which has been pushing national carmakers to
boost their competitiveness, earlier this week said current
export levels were unsatisfactory and urged them to take steps to
improve sales abroad.

Deputy trade minister Ahmad Husni Mohamad Hanadzlah told
parliament that Proton's exports accounted for only 6.1 percent
of its total production while Perodua's accounted for only 1.7
percent.

Proton exported 10,916 units in 2004, compared with its
production of 179,700 units while Perodua exported 2,180 out of
125,820 units.

Separately, total vehicle sales in February rose 20.4 percent
year-on-year to 36,904 units as customers rushed to buy in
anticipation of higher car prices under a new tax regime, Bernama
quoted the Malaysian Automotive Association as saying.

Of the total, 61 percent or 22,419 units were national
passenger cars and commercial vehicles, while the remaining
14,485 units were non-national cars, it said.

The association said the uptrend in sales was expected to
continue into March, as market sentiment and consumer confidence
remained strong.