- The weaker ringgit is prompting Honda Malaysia Sdn Bhd to raise car prices from January
The weaker ringgit is prompting Honda Malaysia Sdn Bhd to raise car prices from January, following in the footsteps of its Japanese compatriots.
In a statement today, Honda Malaysia said it is currently analysing the impact and estimates the price increase to be around 2% to 3% depending on the model.
“Honda Malaysia will continue monitoring the exchange rate situation closely and will decide on the price in December 2015.”
Managing director and chief executive officer Yoichiro Ueno said: “Since the introduction of Honda models at the current price, the ringgit has depreciated by 20%-30% against the US dollar.
“The drastic depreciation of the ringgit has caused a significant increase to the cost of imported parts and components. Despite our efforts to reduce operational costs and expenses to mitigate the impact, we have to take the last measure to shift the impact partially to the price.”
He explained the automotive industry is especially vulnerable to fluctuations in currency due to imported parts and components in foreign exchange, but the effect is usually not immediate.
“Honda Malaysia has purchased some parts and components earlier when the ringgit was stronger. However, current and future purchases are exposed to the ringgit instability.
“If the ringgit appreciates to the previous level, we would re-evaluate the pricing structure once again.”