The CMCO and the end of the loan moratorium on Sept 30 cause consumers to spend cautiously

by NUR HANANI AZMAN / pic by MUHD AMIN NAHARUL

THE Malaysian Automotive Association (MAA) expects the vehicle sales volume this month to be lower than September due to the implementation of the Conditional Movement Control Order (CMCO).

MAA president Datuk Aishah Ahmad said the CMCO, which is currently being implemented in Kuala Lumpur, Putrajaya, Selangor and Sabah, will cause consumers to spend cautiously.

“Consumers are also being cautious with the end of loan moratorium on Sept 30.

“However, MAA is sticking to its sales volume projection of 470,000 units this year. We are not changing it for now,” she told The Malaysian Reserve (TMR) yesterday.

According to MAA, vehicle sales for both passenger and commercial in September stood at 56,444 units, which was 7% higher than in August where 52,800 units were sold.

Vehicle sales in Malaysia surged 26% to 56,444 units in September 2020 from 44,666 units in the same month last year.

Aishah said sales of passenger vehicles jumped to 51,422 units in September 2020 from 40,267 in September 2019, while sales of commercial vehicles increased from 4,399 to 5,022.

“The higher sales volume in September 2020 was due to the ongoing promotional campaigns by car companies and higher productions,” she added.

However, for the first nine months of this year, MAA said sales dipped 23% to 341,489 units against 442,985 in the same period last year.

In terms of total production, MAA said 51,987 vehicles were produced in September this year compared to 45,101 units in the same month last year.

“The production of passenger vehicles rose to 49,966 units in September 2020 versus 42,369 last year, while the production of commercial vehicles shrank to 2,021 units from 2,732 previously,” it said.

Despite disruption caused by the Covid-19 pandemic, automotive industry players in Malaysia remain aggressive, reflected by the robust growth in this segment.

Proton Holdings Bhd’s highly anticipated new SUV, the X50, is expected to impact the sales volume of other models of different brands in the same class, including those in DRB-Hicom Bhd’s portfolio.

Proton Edar Sdn Bhd CEO Roslan Abdullah said the X50, the company’s first B-segment SUV, offers the latest technology with more affordable pricing than other competing models that were introduced a few years ago, giving the model an added advantage.

Meanwhile, JF Apex Securities Bhd analyst Nursuhaiza Hashim said the automotive segment’s financial performance shall improve, banking on stellar sales achieved by UMW Toyota Motor Sdn Bhd and its 38%-associate company, Perusahaan Otomobil Kedua Sdn Bhd.

“I think its automotive segment will register better earnings towards the end of the year as consumers want to benefit from the sales tax exemption.

“Group earnings may be offset by the equipment segment due to less industrial activities that could have an impact on the demand for heavy and industrial equipment. The manufacturing and engineering segment is expected to be moderate given fewer deliveries in its aerospace business,” Nursuhaiza told TMR recently.