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Fuel Economy: an Overview of Fuel Crisis and Prices in Malaysia

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Fuel economy is the related of distance travelled and fuel consumed when using the car. It is estimate by taking both the fuel and the electric power used in terms of the amount of fuel consumption. (Yugong Luo et al., 2015) One of the factors that affect consumer’s choice on buying a car is fuel economy. This is because of the price of fuel in Malaysia from the graph below that keep fluctuate. For example, in the end of year 2018 until the early year 2019, the price per liter for Ron 95 from rm2.20 decreased to RM1.98 and then increased back to RM2.08. (Kementerian Perdagangan Dalam Negeri Dan Hal Ehwal Pengguna, 2019)

The price of fuel in Malaysia can be affect from many factors such as world crude oil price. Even though, Malaysia is an oil producer, but the country still cannot control the price of fuel since Malaysia is relying on the international trade price which is highly vulnerable to fluctuations because we also import the oil from other countries. This can be proved from the statement in Awani news which is the retail prices are based on global crude oil price. (Hariz, 2018) Under this mechanism, the retail oil price will increase if the global crude oil price. It also gives the same affect if the global crude oil prices declined. When the rate of the gasoline keep fluctuated, the customer will think on how to reduce the fuel cost when buying a car since the price of fuel can increase more higher than usual. For example, in Malaysia people likely to buy Perodua car because the brand of the car is more fuel-efficient compared to other cars. This is added with the rising cost of living where the people need to think twice when buying a vehicle. This is due to the fuel is the main expenses when we use the car as fuel is needed to move the vehicle.

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Based on the article Emerging Issues in Car Purchasing Decision written by Tan Wee Lee and Santhi Govindan, nine out of 10 respondents agreed that fuel economy as an important consideration in their vehicle choice. Unfortunately, in the finding, it shows that fuel economy is not a factor with strong influence for consumers in their car purchasing decision where the respondents would not consider fuel economy when they are going to purchase a car. In Malaysia, it is stated that, even though the fuel economy has a small impact in buying decision but the customer will not choose it as important consideration.

Another alternative-fuel car is hybrid car where the car use two or more kinds of energy such as battery, water and solar instead of fuel. (Imdat Taymaz & Merthan Benli, 2014) This alternative is more to green environment where it can reduce air pollution. The pollution that affect environment is not only because of industry but the purchasing behavior of consumers could be one of the reasons. (Teoh Chai Wen & Nor Azila Mohd. Noor, 2015) Therefore, consumers should consume and aware about green products in order to change the environment. Besides, the rise of fuel price can be one of the reasons for the customer to purchase hybrid car. (Teoh Chai Wen & Nor Azila Mohd. Noor, 2015)

However, there is still lack of facilities for hybrid car users in Malaysia. This could be the reason why consumers did not consider fuel-economy as an important decision when buying cars. For example, in Labuan Federal Territory, there is no any facility for hybrid car even though the price of import car is cheaper than peninsular. Therefore, consumer in Labuan will not buy hybrid car since there is no facility for them to do such as charging.

Besides, in the article Emerging Issues in Car Purchasing Decision, most of the respondent is students and engineers where they not much concern on fuel economy compared to other consumers in different field occupations. The test also suggests that by looking at fuel consumption which is liters per 100 kilometers, cheaper maintenance and green environment is examples of consideration of fuel economy. This is not the main consideration for the respondent when buying a car. The result shows that Malaysian people have less awareness of green environment which make they ignore the importance of fuel economy in the cars feature.

Analysis

Last but not least, fuel economy is the least recommendation for the consumer to buy the vehicle. This is because, when thinking on buying a car, the customers will think about the price and other thing first. While, for fuel economy is the last thing to think about. This can be prove by the article Emerging Issues in Car Purchasing Decision where in the finding said that the respondents would not consider fuel economy as a strong influence when they are going to purchase a car. However, every person has their own opinion. For example, if the person has a high salary, they will choose a car that has fuel economy with alternative fuel car such as hybrid car. But, if the person has low salary, they will think to buy a car that fuel-economy such as Perodua car.

There is also a person that will not think about fuel economy car because they more tend to design and type of car when comes to buying decision. For example, mostly men will buy car according to their desire such as specification of the car. While, for women they tend to buy car that look suitable with them such as Axia car which is small and easy to ride. However, it does not matter whether the car is fuel-economy or not, if the consumer did not drive the car well, then it useless to buy a fuel-economy car since the cost of fuel probably will be the same as other car which is not fuel-economy.

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