Targeted fuel subsidy predicted to impact M40 car buyers more than B40, T20 – RHB Investment Bank

According to RHB Investment Bank, the planned subsidy rationalisation by the authorities volition much heavy interaction the mid-market conception of the automotive market. In a study highlighted by Astro Awani and NST, RHB this was due to the fact that the low-income radical is inactive expected to payment from subsidies portion high-income earners are little apt to beryllium affected by the ending of subsidies.

“We are optimistic astir the wage hikes for civilian workers, with a much than 13% summation apt encouraging user spending connected important purchases. However, we are maintaining our net assumptions for now, arsenic wide sentiment successful the assemblage remains cautious owed to uncertainty surrounding subsidy rationalisation,” it said.

The steadfast added that the restructuring of the Employees Provident Fund (EPF) to see a caller Akaun Fleksibel (also known arsenic Akaun 3) volition person minimal interaction successful presumption of spurring income successful the automotive sector.

“It is anticipated that lone RM4 cardinal to RM5 cardinal volition participate the system annually done these withdrawals. It is overmuch little compared to the RM145 cardinal withdrawn by 8.1 cardinal EPF relationship holders done erstwhile pandemic-related withdrawal programs. Consequently, the withdrawal per subordinate this clip is expected to beryllium lower,” the steadfast explained.

It added that the indebtedness support complaint of year-to-date conveyance purchases reached 58% compared to 62-63% successful 2022-2023, portion gross loans for car purchases lone accrued by 2.7% contempt TIV expanding by 5%. This suggests much stringent requirements for granting loans and consumers switching to much affordable cars.

In the archetypal 4th of 2024, the full manufacture measurement (TIV) made up much than 30% of RHB’s 2024 TIV presumption of 625,000 units. However, this is deemed to beryllium not sustainable and the steadfast is not expecting income to scope a caller precocious and should instrumentality to “normal” levels aft 2 record-breaking years.

The station Targeted substance subsidy predicted to interaction M40 car buyers much than B40, T20 – RHB Investment Bank appeared archetypal connected Paul Tan's Automotive News.