BUTTERWORTH: Soaring diesel prices are taking a toll on transporters that are not allowed to buy subsidised diesel.
Tow truck operators and the Langkawi ferry service warned of mounting pressure on operations that can force a halt on these services.
Penang Motor Vehicles Workshop Owners Association president SC Lee said yesterday that insurance companies pay tow trucks RM80 for towing services within about 150km.
“A tow truck is not only moving under its own weight but is also carrying another vehicle, and may travel long distances.
“In some cases, the fuel and operating cost for a single trip exceeds what the insurance company pays us,” he said.
Lee said the association hoped the government would extend the Subsidised Diesel Control System 2.0 to include tow trucks.
This system allows eligible transporters to buy diesel at RM2.15 a litre.
Unsubsidised diesel was RM2.94 per litre in January and had risen to RM5.52 per litre as of Wednesday.
“We are not transporting goods, but provide an essential service on the road.
“If tow trucks are not supported, we may find great difficulty continuing with this service,” Lee added.
In Langkawi, ferry operators have cut daily trips by 40% after industrial diesel prices more than doubled.
Ferry rides to the island were reduced from five to three trips a day since Wednesday.
Langkawi Ferry Line Ventures Sdn Bhd said the move was necessary after industrial diesel prices surged from RM3.20 to RM7.30 per litre, pushing operating costs sharply higher.
Many sectors are not allowed to buy diesel at the pump and must order industrial diesel.
Its general manager Dr Baharin Baharom said without stabilisation measures such as schedule control, fare adjustments or policy support, ferry operators risk shutting down in the near term.
“Reducing trips is not a choice but a necessity to ensure we can continue operating,” he said.
He noted that ferry fares to Langkawi remain among the lowest in the country at about 88 sen per nautical mile, compared with roughly RM2 per nautical mile for routes to islands such as Tioman and Pangkor.
He said fares have long been kept low to support affordable tourism, but rising costs now pose a serious challenge to business sustainability.
Ferry Line Ventures was established in 2005 through the merger of seven ferry companies and is now the largest ferry operator in Malaysia.
Meanwhile, food prices are seeing low impact from rising fuel costs, thanks to heavy diesel subsidies from the government for the logistics supply chain.
Several supermarkets said there were only minimal rises in the average prices for food and ingredients.
Gama Supermarket & Departmental Store marketing manager June Oh said production costs, which did not get to use subsidised diesel, would likely make up the biggest part of any price increase.
“There had been some fluctuations in the prices of fresh produce since early this year but much of the pressure was tied to festive demand and weather conditions.
“We can absorb much of that. But if there are more increases later, we will have no choice but to pass it on to consumers,” she said.
