Motor vehicle sales 5.5% down


  • Business
  • Saturday, 19 Apr 2003

BY SABRY TAHIR

MOTOR vehicle sales in March fell 5.5% to 35,130 units from 37,194 units a year earlier, largely owing to uncertainties created by the war in Iraq and the Severe Acute Respiratory Syndrome (SARS) outbreak, according to the Malaysian Automotive Association (MAA). 

MAA also attributed the soft market to the consumers' wait-and-see attitude and the non-announcement of the automotive policy, which caused consumers to hold back purchases. It added that the financing of used cars continued to be depressed as a result of lower valuations. 

MAA said new vehicle sales are also not expected to improve significantly for April due to the continuation of negative factors. These include the sideways performance of the local stock market and a lack of consumer confidence. 

It said consumers would continue to hold back purchases in anticipation of lower car prices from the yet-to-be-announced details of the new automotive policy and it sees used car prices remaining depressed. 

For passenger cars, MAA said sales for the month fell 7.23% to 28,726 units from 30,968 units in March 2002. Nevertheless, sales of commercial vehicles improved by 7% to 6,404 units from 6,226 units a year earlier. 

However, March vehicle sales were still 39% higher than those of a month earlier. Sales traditionally fall in February because of the number of holidays and the shortened working period. In February, the local motor vehicle industry saw a 14% drop in sales from the same month in 2002. 

The continued softening of demand for the national car saw sales of the national car segment declining by 9.27% to 25,757 units in March from 28,391 units in 2002. Sales of national commercial vehicles also declined to 1,341 units from 1,612 units a year ago.  

However, sales of non-national vehicles sales were up 11.69% to 8,032 units from 7,191 units a year ago. The bulk of the sales came from commercial vehicles, which rose to 5,063 units from 4,614 units a year previously.  

On the production side, vehicle output dropped 12% in March to 36,677 units from 41,582 a year earlier. For the national vehicle segment, total production fell 14% to 29,616 from 34,540 previously. For the non-national segment, production was more of less maintained at 7,061 units (7,042 a year ago). 

K&N Kenanga automobile analyst Alex Cheah said uncertainties with regard to Afta was the main reason for the downtrend. 

“Although the government had indicated that there would be marginal changes in the prices of the cars after Afta, the actual tariff details are still unknown,'' he said. 

He said unless the issues of economic stability, the war and the automotive policy were fully addressed, he did not see any reason for a rosy outlook in April. 

“There is nothing to drive the market up,” he added. 

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