More Commercial Vehicle Types Get Diesel Subsidy As Rationalisation Date Looms

The Ministry of Domestic Trade and Cost of Living has announced an expansion of the Phase Two Subsidised Diesel Control System 2.0 project to another 14 types of commercial vehicles starting tomorrow.

The newly appointed minister, Datuk Armizan Mohd Ali, said the increase would take the total number of commercial vehicles eligible for subsidised diesel to 23 types.

The added categories for commercial vehicles are rigid lorries (curtainsiders), food catering lorries, rigid lorries (agricultural produce), rigid tank lorries (beverages), rigid lorries (livestock transport), semi (panel vans), and combination rigid lorries.

Also included are service buses, rigid lorries (open platforms), moving service vans, food catering buses, rigid lorries (moving services), food catering vans, and rigid lorries (waste). Companies applying for the subsidy must be registered for business in Malaysia, with the vehicle having valid and up-to-date road tax, and being eligible under the system.

Once the application has been approved, he said the company should immediately submit the ‘Fleet Card’ application to five designated oil companies, namely Petronas, Shell, Petron, Caltex and BHP with a limit of three oil brands for the ‘Fleet Card per company applying.

Under Phase One of the SKDS 2.0 project, nine types of vehicles were involved, namely rigid lorries (general cargo), prime movers, rigid lorries (luton/box), rigid lorries (water tanks), rigid lorries (refrigerated), rigid lorries (flour tanks), window vans, panel van and rigid lorries (bottled drinks).

The expansion also comes as the impending removal of subsidy for fuel, last week a Singapore media reported that Malaysia will announce the new price for diesel and petrol as soon after the Kuala Kubu Bharu election sparking uproar from Putrajaya, until Prime Minister Datuk Seri Anwar Ibrahim calling the reports unethical.

Nevertheless, the fuel subsidy rationalisation will take place as stated by the Economic Minister leaving only the mechanism and control will be the big question.

Meanwhile, economic analysts have indicated that the removal of fuel subsidy could elevate prices of consumer goods as the trickle down effect is inevitable, what is left to be seen is the impact. The move by the Domestic Trade Ministry in offering diesel subsidies for transporters involved in food related supply chain can buffer the impact, but logistics is only one component.

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