June 13, 2011

Pay PUSPAKOM the Pipe Piper

Yes, the government loves a happy winner;not an unhappy whiner!

At the way things are going, more people will become unhappy.

Apparently come dawn tomorrow,all second hand car dealers-mostly companies- or those who need to use bank borrowing to buy second hand cars will have to pay the piper-namely, PUSPAKOM for some additional inspection.

In my case,as a lumpen proletariat, I had this privilege to own a more than 15 year-old car. My usual car insurance company have decided this car and the other one I have, which is also more than a decade old, is not worth them taking any risk on.

As I have to change road tax every year for putting my car on the road, this year will be my watershed year. If my current insurance company do not want to insure my car anymore, than I can only take a third-party insurance.Before a third party insurance can be given, my car must undergo a PUSPAKOM once-over. So, I would have to cough out some money for this inspection to fatten the coffers of this company.



So now let us hear from PUSPAKOM on their brand-new source of income besides ripping off cash from yours truly.

" Puspakom set up new inspection centres and upgraded existing ones to ease the transition to the Hire Purchase Inspection (HPI) regulation that will take effect tomorrow.

It added inspection lanes in Glenmarie, Wangsa Maju, Sungai Petani, Padang Jawa and Kuching to increase the number of cars it could inspect.

It set up new centres in Taman Bukit Maluri, Pandan Mewah, Jalan Tandang (Petaling Jaya), Batu Caves, Taman Daya (Johor Baru) and Pengkalan Chepa (Kelantan).

The new regulation requires Puspakom to inspect used cars before they can be sold to another person.

The regulation requires an additional 14-point check (B7) on top of the standard four-point check (B5) in practice for many years.

Puspakom chief executive officer Hisham Othman said some inspection centres would open on weekends.

"We revised the operating hours of some centres and they may even remain open until midnight."

Hisham said there were no legal obligations for Puspakom to perform the upgrades and to extend its service hours, but felt it would be necessary to ease the transition to the new regulation.

He said Puspakom had spent RM20 billion this year in upgrades and added 121 staff to carry out inspections.

"We brought in new machines from France that will improve efficiency and reduce cost in the long run."

He said it was important to note that the new ruling was passed by Parliament last year.

"Puspakom was merely the agency appointed to oversee the enforcement of the act. Parliament had discussed at length the amendment to the Hire Purchase Act, which will finally be carried out (tomorrow) to safeguard the public's interest."

Because only car sales involving financing from banks are affected by the amendment, cash-based hire purchase agreements do not need to go through the HPI procedure.

Hisham said cars needed to be inspected only once and the B7 inspection report would need to be produced to banks upon buyers' request for financing from banks or anywhere else.

"The reason for this is because banks would want to know the condition of the cars they are financing."

"Buyers, on the other hand, would not want to be duped into buying a 'lemon', and spend more money to fix malfunctioning parts."

He said the worst-case scenario was people buying a cut-and-joined car, where either the front or rear half of another car had been welded to it. "Last year, we discovered more than 1,200 cut-and-joined cars.

"Either way, cars that are not properly serviced, or have their structural integrity compromised, are unsafe."

He said there were around 495,000 transactions made to change vehicle ownership on a consumer level every year.

Hisham added that Puspakom staff were well-qualified and were monitored by the Road Transport Department and other government agencies.

"If the public believe that Puspakom staff did not act with professionalism and integrity, they can complain to the authorities."

The public can call 1-800-88-6927 for information.

UOA Development Berhad-An IPO Folly?

Well, what do you know!

 After all the hype and the IB analysts' medicine-men talk, we ran off to the ATM to apply for this share purportedly a great buy. Though we had a nagging concern over its 5 sen par tag,we believed it was relatively a technical matter and most IB said it was of little concern anyway.

After the book-building the share price was now adjusted to RM2.60 for the institutional buyers while retail buyers got it for RM2.52 with a cash return of RM380.

With baited breath, we awaited the opening price on opening day which the analysts said will be about RM3.20. Starting at RM2.62, it went hay-wire and slid. It was a really dog day for us minority shareholders!

It is now at a new low of RM2.45 even after the parent company in Australia upped its holding while the local counterpart also pitched in.

So, who is selling? Suckers..............?

Something is amiss! Is it an IPO folly?