Automotive industry players will meet Bank Negara Malaysia on Friday to discuss the new guidelines for loan borrowers, following the 25 percent drop in sales of new motor vehicles last month, says Proton.

The guidelines have been in force since Jan 1.

The Proton Edar Dealers Association Malaysia (Peda) has called for the new responsible financing guidelines to be looked into, as it has severely damaged sales with only 30 percent of applicants securing car loans in the first two months of the year.

The Malaysian Automotive Association reported a 25 percent drop in sales of new motor vehicles, due to a tightening of the hire purchase loan approval process, a short working month and impact of Thailand’s flood disaster.

“This Friday, we will meet Bank Negara on reviewing the guidelines and reach an understanding, as it is not just Proton or Perodua but the industry as a whole which is facing difficulties.

“Let us discuss how we can mitigate this, as the long-term impact will be quite big,” Proton Holdings Bhd group managing director, Syed Zainal Abidin Syed Mohamed Tahir said after the ‘Proton-Yes First 4G Internet Cars’, collaboration launch today.

He also said the matter had to be taken seriously as the entire industry eco-system would be severely affected in the long-term if not resolved soon.

“The automotive industry is very much linked to the country’s economic growth.

“We understand the move is in line with the government and Bank Negara’s intention to control household debt and we agree to it.

“But if this continues, it’s not good for everybody, with less cars, less income and less taxes, due to the ripple effect,” he added.

Zainal Abidin said it is important for the industry to be sustainable as well as to grow against the backdrop of the soft economic sentiment.

- Bernama