No SST makes new cars a little cheaper, but not enough in my price bracket to make a difference.
The SST discounts have been relatively effective at boosting car sales for some automakers. However, I, and a lot of people my age will probably not be taking advantage of it for many reasons. Today I’d like to share with you some of these reasons.
Disclosure:
I currently have two vehicles in my possession. One is a 1991 Honda Integra and the other is a 2000 Proton Wira. The Wira, though in my possession, belongs to my granduncle. I couldn’t get the inspection and transfer done before the FMCO rules kicked in. I took the Wira to give the Integra a break from being my daily driver since mid-2019 and to have something a bit more reliable to use for emergency long-distance travel.
Reason #1: There’s nothing fun out there that I can reasonably afford.
If I were to replace my Integra with something brand new that’s fun and within my budget, I’d probably be looking at a Proton Iriz with a manual transmission. As far as new cars go, that’s about as close as it comes. There are a few problems with that choice. The Proton Iriz manual only comes with a 1.3-litre engine. While still a great-handling chassis, it’s just nowhere near as punchy or as special as the experience the Honda offers.
Parts for the Iriz are going to be easier to come by and a warranty would be appreciated, there are other factors to also consider. The costs involved for this peace of mind would be astronomical compared to what I currently spend on my Integra. Per year, the 30-year Honda hatchback costs me RM90 in road tax, RM400 in insurance (including 24-hour, nationwide towing thanks to Allianz Enhanced Road Warrior), and roughly RM500-RM1500 in service and maintenance. On average, I get between 350km-400km per full tank of RON95 from BHPetrol. It’s not an expensive car to run.
If I went for an Iriz 1.3, some of these costs would go down, without a doubt. Fuel efficiency would be much improved. The road tax would be a lot cheaper. And newer parts would not be going through as much wear and tear, so they probably won’t need to be changed in the first few years of ownership. However, there’s still going to be a monthly instalment to worry about. Each month, I would pay the bank what I pay my mechanic every 3-6 months. Does the SST bring the Iriz 1.3L manual’s price down by much? No. That particular model is just RM500 cheaper than before. That’s like removing one instalment payment on a 9-year loan. Negligible.
I haven’t even gotten to depreciation yet. The Iriz costs just RM37,000. That’s not a lot, but a 5-year old Iriz 1.3 manual goes for about RM23,000. That’s 40% of its value lost to depreciation. I got the Honda Integra when prices hit rock bottom for the car. I obviously can’t say what the price will be if I ever sell it, but I sincerely doubt it’ll be 40% lower than what I got it for. Unless there’s a major accident and I’m forced to sell it for parts.
Reason #2: The practical cars I can afford don’t get much more affordable from the SST exemption
The other car I run, the Wira, was a very recent addition. A member of my family had it since 2000 when it was brand new. It needed a bit of work, but is now in running condition. Before I got the Wira, I was entertaining the idea of buying a car just in case I needed to go visit my parents and could not secure a test car in time.
However, the cars I was considering, like the Perodua Axia, Proton Saga or Iriz… they all had such negligible price drops due to the SST break. The other used cars I was looking at, like the Kia Picanto didn’t directly benefit from the SST discount either. Used car dealers are a little more desperate for a sale now, but some are holding on to pre-COVID prices.
So, no. There really is nothing out there that interests me with this SST discount. All new cars are still overpriced. Most budget-oriented cars are not interesting enough to commit years of loan repayments to. I will stick to my older vehicles for now.
