Following the announcement by the Ministry of Domestic Trade and Consumer Affairs (KPDNHEP) to hold an open tender to select service providers for inspection activities of used vehicles (specifically relating to those under hire-purchase) for the new term effective December 18, 2018, PUSPAKOM has clarified that the inspection activities mentioned by the KPDNHEP are only related to the company’s appointment as a service provider with the said Ministry.

Under this agreement, which is in line with the Hire-Purchase Act, PUSPAKOM carries out inspection on used vehicles when they are sold, upon which the new vehicle owners enter into a hire-purchase contract with financial institutions.

However, PUSPAKOM’s main concession agreement with Ministry of Transport to undertake all mandatory inspections for commercial vehicles and private vehicles is still in effect. The concession agreement will only expire in 2024.

With regard to the Hire-Purchase Inspection (HPI), PUSPAKOM will submit a proposal to KPDNHEP offering inspection services for the new term. PUSPAKOM strongly believes that it can draw on its current inspection capacity and capability, ie readiness of the established inspection system, infrastructure, skilled resources and network of inspection centres nationwide to continue to offer such a service to the government.

Revenue from HPI activities account for approximately 7% of PUSPAKOM’s total annual revenue, with an average of 170,000 inspections of used private vehicles conducted annually nationwide. The company revealed said its largest revenue source, which is from mandatory inspections of commercial vehicles and private vehicles, is about 84%. Other services and inspections contribute 9% to PUSPAKOM’s total annual revenue.

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[Chips Yap]

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