Malaysia’s wholesale and retail sector contracted 14.7% year-on-year in July 2021, to RM92.7 billion. According to the department of statistics, reported by Malay Mail, motor vehicles led the negative growth list with -85.4% growth, followed by -8.1% in retail trade and -1.1% in wholesale trade.
In the retail trade subsector, Retail Sale of Automotive Fuel in Specialised Stores fell 14.1%, Retail Sale of Other Goods in Specialised Stores dropped 11.1% and Retail Sale in Non-specialised Stores declined 10.8% compared to the same period last year.
The breakdown of the wholesale trade category is Wholesale on a Fee or Contract Basis (-22.1%), Wholesale of Household Goods (-12.1%), Wholesale of Machinery, Equipment and Supplies (-10.4%) and Non-specialised Wholesale Trade (-1.2%).
As for motor vehicles, the department of statistics divides it into Maintenance and Repair of Motor Vehicles (-88.7%), Sale of Motor Vehicles Parts and Accessories (-87.4%) and Sale, Maintenance and Repair of Motorcycles (-86.9%).
Now, the figures for motor vehicles are shocking, but bear in mind that we were in the middle of a full lockdown in July, and the automotive sector was essentially frozen – parts suppliers, car factories and showrooms all had to close. People weren’t putting miles on their vehicles, which means that maintenance and repair sales were also down.
The auto sector was allowed to restart in mid-August, and with factories back to making cars and the sales side rushing to clear the backlog, August sales have shot up. With a full month of unhindered sales, September should be even better.
According to the Malaysian Automotive Association (MAA), the local automotive industry lost over RM14 billion in June and July due to the shutdown, and that’s just from domestic vehicle sales. The sum will be bigger if one adds in lost revenue from exports of vehicles and components, as well as local sales of spare parts.
“Many of us are bleeding. We have used up much of our savings over the past one year. So, it is a huge relief that finally we are allowed to resume our businesses and to revive our industry,” MAA president Datuk Aishah Ahmad said when welcoming the move to allow businesses to resume operations last month.
The good news for the auto industry is that demand is still there, and the government’s sales tax exemption – introduced in June 2020 and extended twice since – will be in place till the end of the year.
Source : PaulTan