PETALING JAYA: Vehicle sales in the first six months of 2013 should surpass the sales achieved in the first half of last year, despite initial hesitation by customers adopting a “wait-and-see” attitude leading up to the 13th general election (GE13).
“First-half 2013 total industry volume (TIV) should easily surpass the previous corresponding period’s 301,269 units. Our channel checks reveal that auto sales in May are already beginning to show a recovery after a slower April caused by potential buyers hesitating ahead of the GE13,” said RHB Research Institute Sdn Bhd analyst Alexander Chia.
“Also, recall that first-half 2012 TIV was affected by supply constraints arising from the floods in Thailand, in addition to tighter financing caused by Bank Negara’s responsible financing guidelines,” he added.
According to data by the Malaysian Automotive Association (MAA), sales of new passenger and commercial vehicles rose 9.8% to 52,489 units in April from 47,774 units in the same month last year.
Year-to-date (YTD) April vehicle sales stood at 210,153 units. MAA said it expected April sales to be maintained in May.
An industry observer concurred that vehicle sales in the first half of 2013 could surpass the sales recorded in the first half of last year.
“With YTD April sales standing at 210,153 units, you need another 92,000 units to surpass last year’s first-half figures.
“Even if sales were to average 50,000 units in May and June, that’s 100,000 units, and would easily overtake last year’s first-half TIV,” she said.
Moving forward, Chia expects the positive auto sales trend to continue in the second half of 2013.
“Macroeconomic conditions remain supportive of higher consumption spending,” he said.
However, he said there would be issues under contention, stemming from the newsflow of the long-awaited National Automotive Policy expected to be released later this year.
Earlier this month, International Trade and Industry Minister Datuk Seri Mustapa Mohamed said the promise made by the Barisan Nasional (BN) in its GE13 manifesto to reduce car prices in stages would be fulfilled.
BN had pledged in its manifesto to reduce car excise duties, which would lead to a gradual decrease in car prices by between 20% and 30%.
“The BN manifesto included a pledge to gradually reduce car prices. It does not mention a reduction in automotive duties. I believe the current policymakers at Miti (Ministry of Industrial Trade and Industry) are well aware of the pitfalls of an excessively rapid decline in new car prices,” said Chia.
Another industry observer noted that this could cause “another wait-and-see spell” among potential car buyers, hence putting a damper on vehicle sales.
“This could cause potential car buyers to wait on the sidelines to see if prices would actually drop,” he said.
Total vehicle sales in Malaysia grew 4.6% to hit a record high last year, with TIV at 627,753 units. It was also the third consecutive year that the TIV had surpassed the 600,000-unit level, according to the MAA.
It has forecast the TIV to grow to 640,000 units this year.
Chia said RHB was forecasting 2013 TIV to hit 637,000 units.
“We are maintaining our forecast for now and will review it after the first-half 2013 TIV data is out,” he said.