Petrol dealers hit back at Najib - 'We are barely making a profit'

The Petrol Dealers Association of Malaysia has come out against former prime minister Najib Abdul Razak's claims that the government is helping petrol dealers profit from the new petrol prices.

"In Najib's latest statement... (it) gave the illusion that petrol dealers are getting RM30 million every month.

"If you divide it by 3,500 stations nationwide, the average increase in gross profit is RM8,500 every month in each station, when the increased cost for dealers for the past 10 years have been more than RM10,000 a month," the association said in a statement yesterday.

They also pointed out that among petrol dealers in the country, only 10 percent are in the high-sales category - exceeding 600,000 litres a month - whereas 67 percent are in the low- to middle-sales category (below 400,000 litres a month), and 20 percent sell below 200,000 litres a month.

Those who sell below 200,000 litres a month make a net profit of about RM1,500 a month only, they said.

The former BN government had actually done research on the petrol dealing industry and had found that many petrol dealers had qualified for cash aid as many of them made below RM4,000 a month.

"Costs like hiring, utilities, credit card charges, rental to oil companies which are increasing, are causing many in the business to be making a loss," the association said.

A win-win decision

The previous government, they added, has been urged to review the commission many times, yet it had not done so.

At least, the current government understands the situation and is trying to fix the problem, the association said.

"If this industry is forced to incur losses, the chain of supply for petroleum energy will be hampered and it will hurt the economy."

The dealers said throughout the world, a hike in commission has been in line with government policies or cost of operations, such as in India where commission for dealers was increased to 55 percent in 2017.

They pointed out that petrol stations are everywhere in the country, which means they provide jobs to many citizens.

When the government did not act to save the industry, it inadvertently caused many of these people to lose their jobs, they said.

"Even though they (BN government) have done the research and admitted there is a need to increase the commission back then, Najib did not do so before the 14th general election due to worries of going through an election with his waning popularity.

"Because of that, the BN government before GE14 made a promise to dealers to raise the commission after the election.

"Meanwhile, many dealers went bankrupt, many employees lost their earnings and many more families became victims to the government under Najib, who did not act to fix what he should have," the dealers said.

On the other hand, they said they were grateful to the Pakatan Harapan government which has considered all stakeholders by lowering the fuel prices while increasing their commission.

The dealers praised this as a win-win decision, where the rakyat got a lower fuel price while the dealers obtained a buffer against the impact (of lower price) and the government earned popularity.

"This is a brave step and we respect it. The rakyat deserves to know the component of the automatic pricing mechanism," they said.

Najib yesterday accused Harapan of helping petrol dealers profit from the new petrol prices, saying that the dealers could rake in additional profits of RM900 million a year for RON95 with the new fuel prices.

The government yesterday reverted to the weekly float pricing system, according to the automatic pricing mechanism. This saw a fall in RON95 prices from RM2.20 per litre to RM1.93 per litre.

However, Najib argued that the retail price for RON95 should have been RM1.90 and not RM1.93 per litre. - Mkini