Tight Loan Application Rules By Bank Negara Affecting Car Sales, Says Perodua

KUALA LUMPUR, Jan 31 (Bernama) -- Malaysia's second national car manufacturer, Perodua which produces affordable compact cars for the masses, has asked Bank Negara Malaysia to ease up on tight loan conditions for hire purchase of cars imposed effective this year, saying they are affecting car sales. Its Managing Director Aminar Rashid Salleh said on Tuesday that registration of news cars in January dipped by 15-20 per cent while new orders fell five per cent owing to the tighter conditions. Previously, processing for car loans was based on a buyer's gross income, but since January, the central bank has directed banks to base loan approvals on net income, in efforts to curb household debt. Processing hire purchase loans also takes longer, between 7-8 days. "Perodua is the rakyat's car catering for the masses, especially the lower income group, small businesses or parents wanting to take their children to school," he said after hosting a Chinese New Year luncheon for the media. He cited the 660 cc Perodua Viva costing about RM26,000 as being affordable to a wide cross-section of the public. Although he supported Bank Negara's move to curb household debt, Aminar said the central bank should look at other mechanisms to address such debts and not impose credit tightening measures for car purchases. Lower sales of cars would affect the entire eco-system of the country's automotive industry comprising production, distributors, parts vendors as well as financial institutions, he said. Perodua last year was the top-selling marque, selling 180,000 units, up from 188,600 in 2010, and commanding 30 per cent of the market share. On the company's export markets, he said Perodua was looking to penetrate South Africa and the Arab states as well as increase market share in Sri Lanka -- its top export market -- plus drive sales in Indonesia and Mauritius. For Perodua to increase exports and compete with world-class brands, he said auto parts vendors supplying to the company need to upgrade their quality further so as to compete in a liberalised global market. Earlier, in his welcoming speech at the function, Aminar said that consumers could look to something "stirring" at Perodua's showrooms on Thursday, but he did not reveal what it would be. -- BERNAMA