Car loan interest rate has been increased up to 4% for national car and 3.5% for non national car for loan period of 9 years. The loan rates for shorter period also has been increased by local banks. This is a bad news for new car buyers which they will pay higher monthly payment for the same car sold before. Read further news from Thestar below.
PETALING JAYA: Interest rates on car loans have increased by an average of 0.25 percentage point for national cars and 0.7 percentage point for non-national makes since the overnight policy rate — the benchmark interest rate which determines banks’ lending rates — was revised upwards by 25 basis points to 2.25% in early March.
Dealers said they were already feeling the impact.
New car registrations reached 56,139 units last month, 25% higher than the same month last year, as buyers locked in their purchases before the widely-anticipated interest rate hike.
The real impact on car sales figures would probably be seen from April, according to industry players.
“We are expecting an adverse impact on sales from the recent hike,” Proton Edar Dealers Association Malaysia president Armin Baniaz Pahamin told StarBizWeek.
“Already, national cars have higher interest rates than non-national cars before the hike.”
This is traditionally the case because the credit risk in the national car segment is perceived to be higher than in the non-national car segment as the former tends to target the lower to middle-income earners.
OSK Research in its recent report on the sector noted that dealers had fully capitalised on the recent OPR rate hike in making their earlier sales pitches. “This caused a rush as buyers locked in their orders before the OPR was increased in early March,” the research outfit said.
Proton and Perodua car loan rates had been adjusted to 3.75% for loan tenures of five years and below, 3.9% for six to seven years and 4% for eight to nine-year loans, according to major car dealers. Previously, they ranged from 3.5% to 3.75%.
With the new rates, for example, a person looking to purchase a RM40,000 Perodua car with a five-year loan tenure (at the new rate of 3.75% per annum) will have to pay RM791, or RM8 more, per month.
This goes up to about RM20 more a month for a longer-term loans.
As for new non-national makes, a dealer with Kah Motor Co Sdn Bhd which distributes Honda cars, said hire-purchase rates for new non-national cars had been raised to 3.25% for loan tenures of five years and below, 3.4% for six to seven years and 3.5% for eight to nine-year loans.
Before, hire-purchase interest rates were in the range of 2.4% to 2.8%, he said.
“There is some impact on sales so far. We see some individuals holding back purchases,” the dealer added.
Honda’s market share fell last month on weak sales, sliding 5.8% year-to-date as sales halted largely caused by the impending launch of its new CRV towards the end of this month, OSK Research said