Car sales weaken in April but not all gloom
Sales of motor vehicles in April fell 10.6 percent from a year ago, trade association figures showed today.
The Malaysian Automotive Association said motor vehicle sales in April was also down 2.3 percent from March to 34,322 units.
In the passenger car sector, sales of national cars fell 16.10 percent year-on-year to 24,786 units but that of foreign vehicles grew 6.80 percent to 2,772 units.
Sales of motor vehicles in April fell 10.6 percent from a year ago, trade association figures showed today.
The Malaysian Automotive Association said motor vehicle sales in April was also down 2.3 percent from March to 34,322 units.
In the passenger car sector, sales of national cars fell 16.10 percent year-on-year to 24,786 units but that of foreign vehicles grew 6.80 percent to 2,772 units.
This pushed vehicle sales down by 7.10 percent to 134,363 units in the four months to April.
New models
The association said it did not expect market conditions to improve in May but new models expected to be launch could boost sales.
OSK Research said lower sales of national cars in April was hardly surprising as no new models were launched and it faced stiff competition from foreign vehicles, particularly Korean models.
But it remained optimistic of the auto sector, saying consumer confidence was expected to return in the second half of the year following the end of the Iraq war.
Current financing packages for vehicle purchases are still attractive and national carmaker Proton could surprise the market by accelerating the launch of a replacement for the popular Wira model, it said.
Sales in the coming months are also likely to be supported by active sales promotions by non-national makes like Japanese carmakers Honda and Toyota, and South Korea's Kia, it said in a research note.
A real concern
But the brokerage cautioned that the volatility of the yen exchange rate and uncertainty over the tariffs structure under the Association of Southeast Asian Nations (Asean) Free Trade Area (Afta) remained a concern.
"What really concerns us is the yen volatility... (and) the long-delayed Afta package by the government would also be the critical issue that needs to be considered," it said.
Proton currently holds some 60 percent of the Malaysian market due to high tariffs on imported cars.
This protection will largely disappear under Afta where tariffs fall to below five percent in January but Malaysia has obtained a reprieve for its auto industry until 2005 on the levies. AFP
