Friend's opinion: The announcement to scrap 15 years old car and get a rebate of 5K to buy a new NATIONAL car. But why new "NATIONAL" cars only. This seems like unfair to NEW Non-National car makers. What about used car dealer that sell 10 years old cars, who is going to buy it assuming the life line remain to 5 years (15 years) while the price stated by used cars dealers are base on market value.
Another problem will be the car price, our cars selling price are one of the most expensive through out the world due to high tax rate. Many people are unable to pay for the car installments despite having all kinds of downpayment discount and car loan offer.
Base on the report, there are about 1 million cars that were more than 15 years old on the road, why is this group of car owner not wanting to change new cars. There should be a study on this as well but I believe the reasons behind no doubt will include some of the above.
SECOND OPINION (Jeff's):
Cars that are 15 or more years old can still good and useful. My friend's car a 1979 Datsun 120Y is 30 years old (same age as me) this year and gives no problems at all. There are absolutely no reasons at all to scrap these old cars.
Unlike Singapore, the public transport in Malaysia is terrible. Without a car, no matter how old, it is very inconvenient to travel around. With good public transport, there is less need to own cars. As their old cars are scrapped, the owners can use and depend on public transport.
Typically, These old cars are fully paid and car owners are no longer burdened with payment installments.
Many of the owners of old cars are pensioners and retirees who can't afford to pay a few hundred Ringgit monthly installments. Even if they wanted to, no bank would lend them the money to buy a new car.
Some are people who just don't want to pay installments month after month. There are people like my friend (1979 Datsun 120Y owner) who don't see any value in a new car, other than to show off. An old car is perfectly fine to travel around.
A car/s is not an asset but the fastest depreciation liability. What else could lose 10% to 15% of its value after the 1st year? For a relatively cheap car of RM60K, this means a loss of RM6K - RM9K for the year or RM500 - RM750 per month.
How can a car ever be called an asset when there is absolutely no way for it to gain value but only to lose value?
Some old cars have very little residual monetary value left. Many of them are not even worth RM5K. But a RM1000 old car (such as Datsun 120Y) is good enough to travel around town.
BUT WHAT ABOUT GOOD RESALE VALUE CARS? Example "Honda Civic EK 1998". Guess what, this car I mentioned is STILL WORTH RM39,000. Isn't it CRAZY to offer JUST "RM5000 to scrap it? In my opinion, it's NOT JUST CRAZY but INSULTING as well. Another example is "MY CAR" 1999 Ford Telstar Ghia (longtermer in this blog). For your information, my car's STILL WORTH around RM18,000. MY SUGGESTION: Give RM5k for MORE THAN 20 YEARS OLD CAR INSTEAD OF 10 YEARS...
Like my friend, an owner of 1979 Datsun 120Y, Mr.Chieng said: "I'd prefer buying a property for investment over investing on a "New National car" (which this "package" is all about) and ended up paying $$$ INSTALLMENTS".
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