Vehicle sales soar, TIV crosses 64,000 units

By RAHIMI YUNUS

Vehicles sales jumped 50% in June compared to a month before and reached the highest level this year, as both consumers and carmakers scurried to conclude deals during the tax-free period.

The government removed the Goods and Services Tax (GST) effective June 1, making the prices of big-ticket items like vehicles cheaper by 6%.

Consumers had flocked to showrooms to conclude their purchases. Some carmakers stopped taking bookings for selected models due to pricing uncertainties after September with the introduction of the Sales and Services Tax (SST).

The total industry volume (TIV), which measures sales for June this year, rose to 64,502 units from 42,983 vehicles recorded in May 2018. It is the first time vehicle sales breached the 60,000 level this year.

In addition, it is the first time that TIV crossed 64,000 units in the last 30 months.

The improvement in June’s figure was also helped by the Hari Raya promotional offers, which is traditionally the time that the auto industry records good sales.

Vehicle sales slumped in May as buyers put off their purchases until after the zero-rated GST was in place.

The Malaysian Automotive Association (MAA) said sales volume in June 2018 was 28%, or 14,229 units, higher year-on-year (YoY) compared to the month last year.

For the first six-month period (1H18), TIV rose 1.8% to 289,714 units, or 5,261 more than the corresponding period a year ago.

The passenger vehicle segment climbed 2.1% to 261,042 units, but sales of commercial vehicles declined 0.1%, or 34 units fewer, to 28,671 for June.

Perusahaan Otomobil Kedua Sdn Bhd maintained its leading position for the 1H18 with a 44.9% market share.

Honda retained its position as the top non-national car brand with a 19.7% market share, and followed by Proton with 10.4%.

For commercial vehicles, the top three brands were Toyota (32.1%), Isuzu (16.2%) and Nissan (10.6%).

Total production also increased by 10% in 1H18 to 280,947 units, mainly on fulfilling the surge in demand during the tax holiday period.

For 2H18, MAA said heightened trade tension between the US and China, stringent hire-purchase lending rules and the reintroduction of the SST would influence sales.

MAA president Datuk Aishah Ahmad said most vehicles would see price increase due to the SST.

“We are waiting for the technical details of SST. There will be some increases, but they vary based on models,” Aishah said in Petaling Jaya yesterday.

Aishah said the automotive sector is the country’s second-largest tax revenue contributor after oil and gas.

The 289,714 units delivered in 1H18 were equivalent to 49.1% of MAA’s initial forecast of 590,000 TIV for this year.

MAA had revised its yearly forecast to 585,000 from 590,000 units earlier.

On the proposed Indonesia-Malaysia car joint venture, Aishah said the plan must get the support from original equipment manufacturers in the respective countries, easing of exports restrictions and fulfilling the Asean markets.

Vehicles sales in Asean countries are expected to reach 3.1 million units this year.

Aishah said Malaysia does not need a new national car as the local automotive sector is already developed and it has no economies of scale.

“The industry is already developed, including the engineering and vendor side. We have more than 500 vendors today and other brands are using our local vendors.

“None of the other Asean countries has a national car, but they are doing well, such as Thailand and Indonesia,” Aishah added.