Malaysia: Negative Sentiment, Positive Luxury car sales

Can the above happen at the same time? “Negative Sentiment and Positive Luxury car sales” Most of the time, when times are bad, buying a new car is nowhere near top priority. I know, someone wanted to say but Malaysia’s public transportation is so bad, of course everyone needs to buy a car. I have no wish to comment on public transportation because I currently drive despite staying in KL but I will definitely try the MRT as soon as it starts by the end of 2016 (MRT Sungai Buloh). Coming back to buying car, assuming it is a necessity to get a car but may I ask if buying a new car is a must during bad times and while secondary cars are by far cheaper than a new one? Surely it’s a choice, right?
Well, according to one major car site, carlist.my the sales of Mercedes cars are now nearly 50 percent more than BMW. However, both are enjoying record sales in 2016 when compared to 2015. Before we conclude that these are the only two brands going up, take a look at the image. Others like Isuzu, Volkswagen, MINI, Volvo, Renault and Subaru are all going up when compared to the same period in 2015. So, do we conclude that 2016 is the year of recovery? Wait a minute, when we look at top 5 car brands, from Perodua to Honda, Proton, Toyota and Nissan, all 5 have suffered drops! All these are definitely considered the mass market cars. So, overall what has happened? Well, the overall new car sales volume is down by nearly 14%. Yes, a double digit drop.
Personally, I think it’s very clear that Malaysia is definitely not in any form of recession. The wealthy Malaysian group is still doing fine and buying a new luxury car is still within their reach. I think this is the reason for my friend’s question of ‘why are the developers still launching luxury units above RM1 million? Can these units really sell?’ Well, the total number of transactions for properties are still holding and is not falling like a jet plane. As per latest stats, as at Q1 2016, total residential property transactions still reached 49,612 units (Source: NAPIC). Who are these 50k people? I think it’s very safe to say they managed to get their loans approved and that banks continue to lend to them. In brief, sentiment is definitely negative. As for whether everyone is doing badly, the conclusion is up for us to decide. Happy thinking, whether it’s anew car or property.
written on 27 Oct 2016
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