July vehicle sales rise 41% thanks to zero-rated GST

This article first appeared in The Edge Financial Daily, on August 17, 2018.
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KUALA LUMPUR: New vehicle sales in Malaysia rose by 41% to 68,465 units in July from 48,553 units a year ago, as automotive companies reduced the prices of their cars following the government's move to zero-rate the goods and services tax (GST).

"Sales volume in July was 6% or 3,963 units higher than June," said the Malaysian Automotive Association (MAA) in a statement yesterday.

The association expects sales volume for August to be maintained at the July level. The three-month "tax holiday" will end this month when the sales and service tax is introduced on Sept 1.

"At 68,465 units, the sales volume for July was the second-highest monthly total industry volume achieved in the history of the local auto industry," added MAA.

Passenger vehicle sales rose 40.6% year-on-year (y-o-y) to 61,211 units in July, while commercial vehicle sales grew 44.2% y-o-y to 7,254 units.

Year to date, total vehicle sales climbed 7.6% to 358,179 units from 333,006 units a year ago.

Meanwhile, total vehicle production for July also rose 25.5% to 55,164 units from 43,952 units a year ago.

Passenger vehicle production rose 26.4% y-o-y to 51,165 units in July, while commercial vehicle production increased 15.6% y-o-y to 3,999 units.

Between January and July 2018, total vehicle production gained 12.3% to 336,111 units from 299,270 units.