ABOUT 9,000 second-hand cars were bought and sold in just four days this week, indicating a shift in consumer spending in the face of an economic downturn precipitated by the Covid-19 pandemic and the consequent movement-control order to contain the outbreak.

Federation of Motor and Credit Companies Association of Malaysia president Tony Khor attributed the high trade volume of used cars to the ease of online transactions and the Hari Raya season when it is the custom to buy a new vehicle.

“The car-delivery volume from May 18-21 was very good. It was the effect of backlog orders plus positive sentiment over government subsidies.” 

Khor told The Malaysian Insight some of the deals to buy or sell were made before the MCO started.

Between May 18 and 21, about 4,200 cars were sold and 4,800 cars received. About 60% of the cars sold were priced around RM30,000, he said.

The six-month moratorium on loan repayments is also a factor, Khor said, as consumers feel they have more money to spend.

Many second-hand car dealers sell online via the association’s EZAuto platform during the MCO period. The digital platform offers related services, such as transfer of ownership and loan guarantees.

Steven Ng, who works in the car industry in Kuala Lumpur, said online purchases of used cars has been growing in recent years and the MCO accelerated the shift. 

Although orders can be placed online, the seller and buyer still need to meet to sign and fingerprint the documents.

“There is still no way to complete the entire purchase electronically.”

Meanwhile, more people are selling their cars to second-hand dealers because Malaysia does not set a limit on the life service  of a car. 

“Given the current economic situation, many have also turned to second-hand cars instead of buying new models.”

The auto market is showing visible signs of recovery, he said.

“Despite the MCO, the second-hand car market is active with many customer enquiries and transactions taking place.

“You can’t really say it is good but at least there are people buying as was the case in January and February before the MCO.

“It was also good in March and now, many are concluding the deals from March and April.”

May is expected to see a lower volume of trade “because many people can’t go back to their hometowns for Hari Raya and it is for this homecoming trip that they usually buy a new car”. – May 24, 2020.