Analysis,Autos,General News

Imported Car Prices Increased

Imported Car Prices Increased

The government seems to be on the course of reversing whatever it had promised to the people in AIDEP 2021-26. 

It is worth reminding our readers that the government had vowed to provide affordable cars to the masses in the abovementioned policy. To this end, it had decided to slash duties and cut down on taxes to make cars more affordable

However, now the government wants to make car import costly by massively increasing regulatory duty on them.  

Bad news for Japanese or imported car buyers and importers

The latest bad news is for traditional cars with combustion engines, electric vehicles (EVs) and hybrid vehicles.

New regulatory duty on EVs

  • 10% regulatory duty on CBU EVs with battery packs of over 50 KWH. However, trucks and commercial buses will be excluded.
  • This is in addition to the 17% sales tax on EVs proposed in the mini budget.

Think→ Audi e-tron

New regulatory duty on Hybrids

Imported hybrids of engine displacement 1500cc to 1800cc to have regulatory duty of 50%. Previously it was 15%.

Think→ Toyota Prius, Aqua, Honda Vezel

New regulatory duty on conventional cars

For regular imported cars with combustion engines of 850cc to 1800cc displacement, the regulatory duty has been increased from 15% to 50%.

Think→  Toyota Vitz and Passo

Déjà vu

It certainly is a Déjà vu feeling. After all, only last week, the government had increased duties on both locally manufactured and imported vehicles.

To summarize:

A confused government leads to super confused and frustrated masses

Truth be told, the government had been giving mixed signals for some time now. Concerned about the ever increasing Current Account Deficit (CAD), the government just doesn’t know how to go about cutting it. 

First it came up with the novel idea of completely banning imported cars (CBUs), only to realize it couldn’t take this drastic step. 

Then came the unveiling of AIDEP 2021-26, which gave a lot of hope to the people as well as the auto industry.

However, soon after, the government tabled the infamous “mini budget” which reversed most of what was announced in AIDEP 2021-26. 

As if this was not enough, the latest decision taken by ECC is bound to massively jack up CBU prices. 

Masses are the ultimate losers

While on the face of it, the latest from ECC is not CKD specific, it is bound to further increase the prices of locally manufactured vehicles by driving up their demand.

This will happen when buying imported cars becomes too expensive, leaving the people to instead pursue locally manufactured cars, driving up their demand.

As their demand goes up, they will not only cost more, they will also be delivered late, which in turn will increase their “ON ” or “OWN” money. 

So, no matter how you look at it, it’s a lose-lose situation for the ordinary people. 

Let us know what you make of this news. Also let us know how much car prices will go up. 

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