MAA says traffic volume at automotive showrooms is expected to be lower and will impact sales

by RAHIMI YUNUS / pic by TMR FILE

VEHICLE sales volume is expected to decline this month compared to October due to the full-month impact of the Conditional Movement Control Order (CMCO) that has been imposed mainly on the peninsula.

Malaysian Automotive Association (MAA) said traffic volume at automotive showrooms is expected to be lower and will impact sales.

In October, vehicle sales volume grew 5.2%, or 2,800 units, to 56,670 from 53,870 recorded in the corresponding month last year. The sales volume was flat on a month-on-month basis, increasing 0.4%, or 226 units from 56,444 delivered in September.

The 56,670 units comprised 51,795 and 4,875 units registered in the passenger and commercial vehicle segments respectively.

MAA attributed the performance to new model launches and ongoing aggressive promotional campaigns by car companies which pushed the sales volume slightly higher for the month under review.

Proton SUV X50, Honda City and Nissan Almera were among new models that entered the market last month.

Year-to-date as of October, carmakers sold 398,159 units, down 19.9% year-on-year (YoY), or 98,696 units, from 495,855 for the same period in 2019.

The 398,159 units represent 84.7% of MAA’s total industry volume forecast for 2020 of 470,000 units.

The automotive industry needs 71,841 units sold for the remaining two months of the year to hit the target.

On the production front, MAA noted that the volume increased by 5.1% YoY to 58,631 units from 55,755 a year ago.

Carmakers were hoping for a continuation of government tax incentives to help boost the sales volume as consumer spending remains sluggish.

The current tax incentives — which provide sales tax exemptions of 100% for locally assembled vehicles and 50% for imported units — would end on Dec 31.

The tax measures have helped reduce car prices between 3% and 6%.

MAA president Datuk Aishah Ahmad previously told The Malaysian Reserve that “consumers are cautious and not going out as much” amid the pandemic.

Besides the extension of sales tax exemptions, she said a continuation of the loan repayment moratorium would have also had a positive impact on the automotive industry.