Perodua Manufacturing Sdn Bhd acting senior general manager Mohd Saifuzzaman Mohammad said the plan was aimed at fulfilling the demand for low fuel efficient compact cars.
KUALA LUMPUR: Distributive Trade Index (DTI) growth slowed to 5.8% year-on-year (y-o-y) in July from 8.0% y-o-y in June on moderation in wholesale trade and retail trade as well as the drop in motor vehicles trade.
Maybank IB research said on Wednesday that the component of DTI that is of key interest is the retail trade index as it is highly correlated with real private consumption, with % y-o-y correlation coefficient of +0.74, compared with +0.48 for DTI, -0.42 for wholesale trade index and +0.43 for motor vehicle trade index.
“While retail trade index growth eased in July to 8.4% y-o-y (June:9.7% y-o-y), growth in the first month of the third quarter (Q3 2016) is firmer than the average of 7.4% y-o-y in Q2 2016 and is sustaining the upward growth momentum seen since Q4 2015.
“This point to sustained momentum in real private consumption growth which also picked up since Q4 2015 to 4.9% y-o-y to 5.3% y-o-y in Q1 2016 and 6.3% y-o-y in Q2 2016, following the post-GST slowdown to 6.4% y-o-y in Q2 2015 and 4.1% y-o-y in Q3 2015 after the pre-GST surge of 9.0% y-o-y in Q1 2015,’’ it added.
The trend in retail trade index and real private consumption growth indicate the GST effect has faded and overtaken by disposable income boosting measures that are mainly targeted for the low- and middle income groups i.e. higher amount and more recipients of BR1M; three percentage point cut in workers’ contributions to EPF; personal income tax reliefs; revisions in civil service pay; minimum wage hike.
The brokerage added besides “normalisation” post-July 2016, motor vehicle sales in the following few months may get a boost from the launches of new or upgraded models such as Perodua Bezza, Proton Persona and Honda Civic, noting that motor vehicle sales bounced to 52,312 units in Aug, up 23.2% month-on-month (m-o-m) while y-o-y drop eased to 2.1%.
The motor vehicle trade index have fallen y-o-y in six of the seven months up to July, in line with negative trends in other related indicators. Motor vehicle sales fell 27.6% y-o-y and 26% m-o-m to 42,471 units (June 2016: -0.1% y-o-y and +28.4% m-o-m to 57,358 units) while loans approved for purchases of motor vehicles fell 26.4% y-o-y to RM3.25bil (June: +15.2% y-o-y or RM4.44bil), although these figures could well be due to the shorter working month and “frontloading” before the Eid holidays which have also affected industrial production and external trade numbers.
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