Auto Sector Likely To Encounter Obstacles In H2 2024

Despite numerous sales efforts to draw customers, the Malaysian Automotive Association recently reported a 2.3% year-over-year (y-o-y) decrease in total industry volume (TIV) to 71,162 units.
Research firms, such as RHB and Kenanga, predict that the auto industry will encounter obstacles in the upcoming months and anticipate a decline in TIV in the second half of 2024 (H2 2024).
In a note, RHB Research stated that unit sales for the majority of the major brands decreased last month. Proton, Toyota, and Honda saw y-o-y declines of 10%, 17%, and 5%, respectively.

Perodua, on the other hand, saw its best-ever monthly sales, selling 34,700 units (+11.6% year over year). Excluding the second national automaker, TIV would have decreased by 13% year over year in August. TIV for the first eight months of the year was 533,000, up 5.9% year over year, according to the report. The research firm attributed the impressive result to the 8% year-over-year growth in passenger car sales and the 14% decline in sales of commercial vehicles, which was probably caused by the elimination of the diesel subsidy.

The report also stated that the removal of the diesel subsidy likely had an impact on the 14% decline in sales of commercial vehicles, but the 8% year-over-year growth in passenger car sales was the primary driver of the strong YTD TIV performance. However, RHB stated that September's TIV performance is expected to be lower due to Perodua's scheduled factory maintenance shutdowns, which happened to fall during the recent long weekend for Malaysia Day.