Tuesday, April 19, 2011

'Ban On Used Parts Puts Job At Risk'

KLANG: Almost 250,000 jobs are at risk should the government decide to ban the import of used spare parts, said Malaysia Automotive Recyclers Association (MAARA)

"The prohibition would have a profound effect on the industry since many of these firms have to change business or close shop due to the insufficient supply of locally-sourced used parts and components. Retrenchment of workers is a real possibility," said MAARA chairman Gwee Bok Wee yesterday.

He was speaking to the media after releasing the results of a study on the effects of banning the imports of used spare parts.

The association hired Universiti Utara Malaysia and Universiti Teknologi Malaysia to conduct the study last year, soon after the National Automotive Policy was announced.

From the study, it was revealed that the industry has a workforce of 242,800 people, comprising recyclers, repairers and others. It revealed that the industry is worth RM14 billion.

The ban, which is due to start in June this year, was initiated mainly to improve safety standards for consumers and promote environment-friendly opportunities.

"These arguments, however, do not hold water when presented with the study's findings," said Gwee.

On safety issues, he said imported genuine used parts are of higher quality compared with locally-sourced parts and components.

"The problem with local used parts is that they usually come from two sources - first from very old cars, those more than 10 years old, second from accident cars. These parts, to some extent, pose danger to consumers," said Gwee.

On environmental concerns, Gwee said production of new parts and components would increase the consumption and depletion of virgin materials, increase energy consumption for processing, increasing carbon dioxide emissions, reduce landfill space and generate excessive chlorofluorocarbon emissions.

"At the same time, a rise in the demand of locally sourced parts and components would probably increase environmental degradation due to the lack of regulations," he said.

More importantly, prices of new and used spare parts produced locally are expected to increase as a result of this ban, said MAARA.

The association said it will submit a proposal to the Ministry of International Trade and Industry next week, and in it, it hopes the government would reconsider the ban. It also suggested for an agency to regulate the industry.

I think in this world Malaysia is the first country to ban on importing used parts. Correct me if I am wrong.

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