Sales of new vehicles or total industry volume (TIV) are projected to jump 17.9 per cent or 91,089 units to 600,000 this year, according to the Malaysian Automotive Association (MAA). Pix by Reuters.
Sales of new vehicles or total industry volume (TIV) are projected to jump 17.9 per cent or 91,089 units to 600,000 this year, according to the Malaysian Automotive Association (MAA). Pix by Reuters.

KUALA LUMPUR: Sales of new vehicles or total industry volume (TIV) are projected to jump 17.9 per cent or 91,089 units to 600,000 this year, according to the Malaysian Automotive Association (MAA).

Of the total forecast, passenger vehicles (PV) would likely account for 540,000 units and commercial vehicles (CV) might reach 60,000 units mark, the MAA president Datuk Aishah Ahmad said.

The TIV eased 3.9 per cent or 20,603 units to 508,911 in 2021 from 529,514 registered in 2020.

Of this, passenger vehicles (PV) accounted for 452,663 units and commercial vehicles (CV) comprised 56,248 units.

Aishah said the TIV fell for the second consecutive year. However, the 3.9 per cent contraction was much smaller than the 12.4 per cent contraction recorded in 2020.

She said the expected sales growth this year would likely be fuelled by the expected rebound post-pandemic with an assumption of normalisation in economic and social activities, barring any unforeseen circumstances.

"Continuation of the Sales and Services Tax exemption incentive for passenger vehicles until June 30, 2022, production and deliveries ramp up by automotive companies to fulfil backlog, and new orders will be the main contributors in improving sales of new motor vehicles," she said in a virtual media conference today.

Aishah said continued low interest rate enviroment could be a stimulus to accelerate the pace of economic recovery.

"This may help to stimulate domestic spending including for big ticket items like new cars," she added.

Aishah said consumer's spending would likely recover in tandem with the country's economic recovery, while the introduction of new models including electric vehicles (EVs) at more competitive prices can assist to sustain buying interest.

The MAA expects EVs to be a growing segment in 2022 backed by continued interest from car manufacturers to bring in green vehicles resulted from the revived government's policy, namely - the Low Carbon Mobility Blueprint or the National Automotive Policy.

"But, we still believe Proton and Perodua would be the main TIV drivers for 2022. Aggressive promotional campaigns by MAA members to push sales and to recover market share may also push sales in 2022," she said.

However, Aishah said the automotive industry might continue to face pandemic-related disruption challenges and supply chain issues such as new wave of Covid-19 infections, shortage of semiconductors chips, rising cost of freight, uncertainties in domestic political scene, among others.

"These challenges may affect the country's economic growth momentum and in turn the sales of new vehicles," she cautioned.

Nonetheless, Aishah said it was unlikely these disruptions would cause major upheaval in the economy, given that much experiences that had been acquired by the authorities in handling of Covid-19 crisis over the past two years.