Carsome: Wage hikes must be matched by skills training, productivity gains

KUALA LUMPUR: The minimum wage increase announced in the 2027 Budget needs to be implemented alongside investments in industry-relevant training, said Carsome Group.

Chief business officer Aaron Kee said that the rise from RM1,700 to RM2,000 alongside the RM2,500 minimum for semi-skilled and graduate roles puts workforce costs and productivity firmly on the business agenda.

He said better wages matter, but their long-term impact depends on whether businesses can sustain them while remaining competitive.

"In the automotive industry, skilled technicians, inspectors and other specialised talent are essential to service quality, operational efficiency and consumer confidence.

"This makes continued investment in the skills, systems and productivity needed to create greater value increasingly important as businesses adapt to higher payroll costs. This is where industry-relevant training and technical and vocational education and training can play an important role.

"Aligning training with actual industry needs can help businesses develop talent while creating clearer pathways into automotive careers," Kee said in a statement.

Kee added that over time, this could help ensure that better wages translate into stronger livelihoods without undermining the sustainability of businesses that create those opportunities.

He said the budget's focus on industrial development, including the Automotive Hi-Tech Valley in Tanjong Malim, reflects the country's continued ambition to strengthen its automotive capabilities.

He noted a competitive automotive industry also needs businesses that can grow sustainably, consumers who can afford the mobility they need and a skilled workforce ready for the industry's next phase of development.

On the increase in personal tax relief and continued fuel assistance, Kee said having more disposable income does not translate to affordable vehicle ownership.

"For Malaysians, the cost of owning a vehicle extends beyond fuel to purchase prices, financing, insurance, and maintenance. These costs influence not only what consumers can afford but also the choices available to them.

"A competitive automotive market benefits from offering options that cater to different financial circumstances, including access to quality pre-owned vehicles," he said.

Additionally, he said the wider automotive ecosystem plays a role in determining how competitive the market is and how well it serves consumers.

The budget's continued support for green investment, alongside capital allowances for machinery and information and communications technology, could help businesses invest in infrastructure and operational capabilities, subject to applicable conditions.

"Plans to add 50 highway electrical vehicle chargers, coupled with new telematics requirements for commercial vehicles, also signal the mobility sector's evolving needs.

"These developments present opportunities for businesses across the industry to adopt technology, improve efficiency and respond to changing consumer expectations, while maintaining trust and delivering better experiences.

"A stronger automotive ecosystem is one in which innovation benefits not only manufacturers but also the businesses and consumers connected to the wider market," Kee added.