MAA: Malaysian car dealers suffered RM 14 bil in losses in June and July 2021

According to the Malaysian Automotive Association (MAA), dealers across the country had posted total losses of more than RM 14 billion in June and July 2021. In essence, the former federal government's decision to ease restrictions might sound like a lifeline for those affected businesses but is it too little, too late?

The losses incurred was due to the third movement control order (MCO 3.0) which took effect since 1-June 2021. As a result, the local automotive industry ecosystem, which includes motor vehicle production plants, distribution centres, and sales centres, was halted.

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Based on MAA’s latest statistics, only 1,921 units in June 2021 and 7,086 units in July 2021 were sold. This is a huge decline compared to the average monthly total industry volume (TIV) which is between 45,000 to 50,000 units.

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Meanwhile, production was also hampered as total industry production for June and July 2021 were only 276 units and 2,775 units respectively. It’s another sharp drop compared to the average total production of 40,000 to 50,000 units a month.

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MAA is a trade body with around 1,300 dealers nationwide acting as its members and unfortunately some of these dealers are feeling the brunt of the lockdown, in particular the smaller ones.

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Many of them are facing severe cashflows problems and difficulties retaining their employees. These losses have been “very substantial and unprecedented” according to MAA.

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The trade body has supported the government’s decision on re-opening a number of economic activities, including sales and production of motor vehicles in states under Phase One of the National Recovery Plan calling it a “huge relief”.

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As for the Covid-19 vaccination, MAA has said that its members had registered for the Covid-19 immunisation programmes for their employees. In addition, it said that many MAA member companies’ employees have already received at least one dose of the Covid-19 vaccine while a few companies had almost all their employees fully vaccinated by now.