MAA: TIV to grow 2% to 680,000 units this year

Folks,

Few days ago, the Malaysian Automotive Association (MAA) released the total vehicle sales - also known as total industry volume (TIV) - for the full year 2014. You can download the document here.

Last year, the TIV grew 1.6%, but fell short of 2% or 13,535 units below its target of 680,000 units. The historical data of the TIV is presented below.

Year	TIV	Passenger Vehicle	Commercial Vehicle
2005	552,316	503,712	48,604
2006	490,768	446,172	44,596
2007	487,176	442,885	44,291
2008	548,115	497,459	50,656
2009	536,905	486,342	50,563
2010	605,156	543,594	61,562
2011	600,123	535,113	65,010
2012	627,753	552,189	75,564
2013	655,793	576,657	79,136
2014	666,465	588,341	78,124
2015F	680,000	600,700	79,300
2016F	694,280	613,780	80,500
2017F	709,554	627,554	82,000
2018F	725,874	641,874	84,000
2019F	743,295	657,295	86,000

Source: MAA

Visually, the TIV looks like this:

According to MAA president Datuk Aishah Ahmad, the government - in its National Automotive Policy (read it here and also here) - may not be able to meet its target of achieving a TIV of one million units by 2020.

She said during the press conference that the target was "ambitious". This is true as well, given the fact that MAA in its forecast said that the TIV in 2019 - a year before 2020 - will only hover at around 743,295.

As for the implementation of goods and services tax (GST), Aishah is keeping a tight lip on whether the car price will increase or not. She said that under current regulations, car makers or dealers can only claim 20% from the 10% sales and services tax imposed from the government. The remaining 80% will be borne by them.

She added that the industry is unsure on the tax mechanism that will be imposed to the dealers and car manufacturers, and the government has yet to issue a full directive.

On cash-for-clunkers, Aishah said that there are many questions that has yet to be answered, before the system can be implemented

Last week, Perodua president and chief executive officer Datuk Aminar Rashid Salleh echoed the same view. Aminar Rashid asked: who will bear the cost? what is the suitable age for the cars to be disposed? how will the scrappage mechanism works?

For the uninitiated, the cash-for-clunkers, also known as the car rebate system, is an economic incentives provided to those having cars aged 10 years or more to be scrapped and exchange for a new one.

Earlier this month, Malaysia Automotive Institute (MAI) CEO Madani Sahari said that the TIV this year may grow to 700,000 units if the government implements the cash-for-clunkers systems. (Read here for details).

Madani explained to reporters that it is in advance discussion with the government to implement the system by March this year. As for the cost, he said that it will be equally shared by the government and car makers of RM2,500 each, making the rebate cost RM5,000.

However, Aishah said its members have not agreed to anything at this stage, and discussions are still on-going.

Anyhow, the government - via Ministry of International Trade and Industry - is expected to announce the progress of the NAP 2014 on January 29. Perhaps, I should ask the minister on his thought.

Anyway, below is my coverage of MAA, which was done in the form of a video: