New Vehicle Sales Volume Forecast To Decline 8.8 Percent

July 23, 2009 16:47 PM

New Vehicle Sales Volume Forecast To Decline 8.8 Percent

By: Ramjit

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PETALING JAYA, July 23 (Bernama) -- Sales volume of new motor vehicles registered in Malaysia is forecast to decline 8.8 percent this year to 500,000 units from the 548,115 last year.

Malaysian Automotive Association (MAA) president Datuk Aishah Ahmad, in stating this on Thursday, said that confidence in the automotive industry will gradually turn around in the second half of the year.

"The forecast is a realistic figure based on economic and environmental factors. It is also based on expectations that Malaysia's economic recovery is expected only in the fourth quarter of 2009," she said at a media briefing here.

For the first half of 2009, the total industry volume saw a drop of 9.7 percent to 251,092 units from 277,973 units in the corresponding period of 2008.

The decline was lower than the original forecast of 12.4 percent, Aishah said.

Malaysia's total industry volume of new motor vehicles for the first half of the year was also one of the highest among the Asean countries, she said.

According to MAA, new model launches by Proton, especially the Exora as well as those of non-national cars in the first half of the year, helped to drive the industry volume.

The introduction of new models may also help to sustain buying interest in the second half of this year, the association said.

However, Aishah said the hike in hire-purchase interest rates had affected sales of non-national motor vehicles.

"In addition, banks are getting more cautious and stringent in providing hire-purchase loans. As a result, car buyers face difficulties in obtaining loans to finance their purchases," she said.

While the economic downturn has afffected motor vehicles sales from the middle and lower income groups, premium car sales has only gone down slightly, MAA said.

Sales of new passenger vehicles during the first six months of 2009 was 228,200 units, accounting for 90.9 percent share of the total industry volume, it said.

However, the 228,200 units in sales volume achieved was lower than the 254,252 units recorded in the corresponding period of January to June 2008, the association said.

Total production volume in the first half of 2009 declined by 12.7 percent to reach a total of 229,842 units from 263,222 units in the same period last year.

"This drop in production volume is higher than the 9.7 percent fall in sales for the first half of 2009 as adjustments in production were promptly undertaken to avoid an overstock position," Aishah said.

She said the strengthening of foreign currencies also affected the industry, with MAA members absorbing losses in the exchange rate in order to maintain prices.

The US dollar and Japanese yen have strengthened, and MAA members may face difficulty in continuing to absorb losses in the foreign exchange rate, she added.

On developments of the National Automotive Policy (NAP), Aishah said the government was gathering feedback from the industry.

"The main consideration to this issue is Proton is without a partner," she said.

-- BERNAMA

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