Local auto players confident TIV can exceed 500,000 units this year - MIDA | Malaysian Investment Development Authority
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Local auto players confident TIV can exceed 500,000 units this year

Local auto players confident TIV can exceed 500,000 units this year

31 Dec 2020

The local automotive ecosystem players, comprising suppliers and independent dealers, are optimistic the total industry volume (TIV) may surpass the minimum threshold of 500,000 units by year-end, despite the uncertainty brought on by the COVID-19 pandemic.

Perodua Suppliers Association (P2SA) president Musa Zahidin Ahmad Zaidee harboured such sentiments despite the industry grinding to a halt between March and May this year due to the enforcement of the Movement Control Order (MCO) due to the pandemic.

“Local suppliers fear this year’s TIV would dip below 500,000 units, which would be risky for our members as they supply automotive components in one form or another to many players in the market,” he told Bernama in a statement today.

Such an occurrence could result in layoffs within the ecosystem, he added.

“P2SA has 129 members and employs nearly 50,000 workers nationwide. Besides supplying components to original equipment manufacturers (OEMs), P2SA members also produce spare parts for the country’s automotive industry,” he said.

Malaysia’s TIV reached 454,708 vehicles between January and November 2020.

While the figure is 17.2 per cent lower than the 549,439 units sold in the same period last year, Musa Zahidin said the industry would only need an additional 45,000 units or so to hit the desired 500,000-unit TIV by year-end.

The extension of the sales tax exemption until June 30, 2021 from Dec 31, 2020 as announced by the government recently would also help to boost new car sales moving forward amidst the pandemic.

“We are fortunate that Perodua is able to rebound strongly and quickly after the initial MCO was lifted in May, and it actually broke several records over the last few months, both in sales and production. These are indeed significant milestones as Perodua is the largest buyer of local automotive components.

“In fact, in October, Perodua made the biggest-ever purchase of locally-sourced automotive components in a month in Malaysian history, totalling RM600 million,” he added.

Perodua Dealers Association Malaysia president Khairul Nizam Ayob echoed similar sentiments, saying independent dealers are also relieved as the volume would be able to sustain jobs and pay for overheads this year.

“Our members are working closely with our principal to deliver as many cars as possible this year as we realise our customers are all chasing the government’s sales tax exemption incentive to spur the automotive industry.

“Perodua’s encouraging sales over the last few months is proof of our commitment to deliver as many vehicles as possible this year for the benefit and satisfaction of our customers,” he said.

Source: Bernama