The Malaysian Tourism Federation is urgently calling on the Government to implement an immediate and substantial diesel subsidy mechanism for van and tour bus operators, it said the recent diesel price increase has inflicted severe financial losses to tour operators and travel agencies who are already grappling with an extremely competitive business environment.
“On average fuel efficiency, a typical diesel bus consumes around 4 kilometers per litre. Every time a bus makes a trip on pre-committed rates established before the price hike, it incurs a loss. This is unsustainable for our operators and threatens their very survival. Tourism business operates on a thin profit margin” commented Datuk Tan Kok Liang, President of the association.
To highlight the severity of the situation, Tan explained, “Each month, tour operators are losing approximately RM 3,600 per bus, based on an average consumption of 3,000 litres per month and RM 1.20 per litre increase. As we are given to understand there are about 10,000 tourism vehicles on the road, without a targeted assistance the next 6 months, tourism operators stand to lose more than RM100 M over this period.
“The tourism eco-system comprised of multiple service providers and intermediaries. Ultimately the final contractual party may have to bear the brunt of the increase. For example, corporate incentive events to Malaysia and been pre-planned a year in advance. Recently a tour company handling an international incentive of 10,000 pax for a 6 days program have to absorbed additional cost of RM300k as the bus operators decline to compromise” commented Tan.
The association has requests for:
1. Immediate Fuel Subsidies up to 31 March 2025 : We request a minimum allocation of 3,000 litre of diesel subsidy per month per unit vehicle up to 31 March 2025. OR
2. Extension up to 31 March 2025 of the RM2.15 Per Litre Diesel Subsidy: We request that the Government extend the RM2.15 per litre diesel subsidy until March 31, 2025.
The remedial action is critical to provide tour operators the necessary time to adjust to the new pricing structure and alleviate the crushing financial burden caught by the rising diesel cost and to ensure the industry remains competitive
