PETALING JAYA: National marques Proton and Perodua would fare worse than non-national marques in 2020's Covid-19 pandemic stressed market, says a report by Kenanga Research.
This was because of the national marques' target markets of lower to mid-income range being the most financially stressed segment.
Last week, the Malaysian Automotive Association (MAA) revised downwards its 2020 total industry volume (TIV) forecast by 34% to 400,000 units from 607,000 units previously, due to negative implications of the Covid-19 pandemic which has severely affected business operations.
If it happens, it would be the first time in 13 years that the TIV fails to surpass the 500,000-unit mark.
The Kenanga Research report pointed out that consumers are cautious on spending on high-value discretionary spending such as vehicles, imported goods and overseas travels.
The research house's economic team views that the Movement Control Order (MCO) to contain the outbreak will adversely impact the economy in the short term with 2020’s gross domestic product (GDP) expected to contract by 1.9%.
It also noted that no sales recorded for April 2020 as the MCO was extended to May 3.
Despite the Federal Government allowing most of the economic sectors to re-open on May 4, including showrooms, the MCO is still in effect with revised measures (i.e conditional MCO) which, together with nine states still maintaining strict MCOs, will continue to restrict consumer spending appetite on high value items.
Selected showrooms have been re-opened on May 4 such as Perodua, Nissan, Toyota and Honda, while Mazda is planned for next week, and Proton will gradually restart operations from May 5, covering both sales and production.
Nevertheless, most assembly plants including Inokom and Proton remain closed, while a few others indicate a possible re-opening next week such as Honda and Toyota, pending approvals from authorities to comply with the new safety regulations.
