My Auto Fest 2016: Why TIV mattersPOSTED BY ON 08 April 2016
THE shorter working month of February and stringent hire purchase loan approval terms and conditions are among the factors contributing to the dip in vehicle sales in February, according to the Malaysian Automotive Association (MAA).
A total of 37,876 passenger and commercial vehicles were sold for the month, a 24.8 per cent slide from 50,390 units sold in February 2015. Meanwhile, vehicle sales for January and February this year totalled 82,467 units, down by 18,525 units from the same period in 2015.
“If our total industry volume is low, it means our country is selling few cars. And when that happens, the entire automotive supply chain is effected,” MAA president Datuk Aishah Ahmad said.
She added, “Manufacturers will be affected in terms of profitability and dealers will end up with lower sales margins. Vendors, on the other hand, will see their supplies and inventories impacted as well. At the end of the day, the government will make less money if the industry sells lesser cars.”
The Malaysian economy is projected to improve, but at a slightly lower pace this year at a forecasted growth rate of between 4.0-4.5 per cent.
“There is much concern over the inflationary pressures that will lead to higher living costs and moderation in spending among consumers at large. This would inevitably affect our industry as well as our new vehicle sales outlook,” Aishah lamented.
Meanwhile, several news sources reported that Malaysia is the most indebted country in the Southeast Asian region, with its household debt totalling over 89 per cent of the GDP.
Responding to a question posed regarding the banking industry’s move to tighten hire purchase loans in terms of repayment period and margin financing, Aishah clarified that the measure was taken as “banks are being extra cautious and there are no directives from Bank Negara Malaysia.”
The MAA is maintaining its TIV forecast of 660,000 units this year.