September 29, 2020, Subang Jaya – Proton Commerce Sdn Bhd, the in-house financier Proton, has expected the hire purchase market for cars to continue to grow during the last quarter of 2020.
The company was incorporated in 2003, as a result of a joint venture between Proton Edar Sdn Bhd and CIMB Bank Bhd. It offers loan packages at competitive rates for Proton car buyers with fast application and approval processes.
For the financial year 2017 to 2019, the hire purchase industry has experienced a growth of 1 to 2 percent, broadly in-line with the Total Industry Volume (TIV) of the Malaysia automotive market.
The industry saw a year-on-year contraction of approximately 1 percent for the first half of 2020, as the Covid-19 pandemic slowed global economies and caused a drop in TIV.
Despite all the external factors, Proton Commerce’s loan assets maintained a Compound Annual Growth Rate (CAGR) of 21 percent from financial 2018 to the current period.
In July 2020, the company registered a historical high in terms of disbursement value and number of contracts, accounting for approximately 15 percent of overall Proton sales for the month.
The achievements were attributed by the competitive rates and the growth of Proton car sales, which rebounded after the Movement Control Order (MCO) period and as at the end of August, have surpassed the year-to-date volume set in 2019.
“Proton Commerce is expecting the number of hire purchase sales for the industry to rebound in the second half of 2020, thanks to the PENJANA stimulus package offered by the government that seeks to grow automotive sales via a sales tax exemption package until December 31, 2020.
“We are also expecting a boost due to the huge interest in the upcoming Proton X50, which will have an impact for both the last quarter of the year and probably into 2021,” said Proton Commerce chief executive officer Mooi Fi Phang in a statement.
Other growth factors for the final quarter includes the recent reduction in the Overnight Policy Rate (OPR) by Bank Negara that allows Proton Commerce to offer more competitive prices to their customers. Currently, the company offers an interest rate from as low as 2.19 percent for the Proton X70, which is on par or lower than competing hire purchase providers.
“As a finance provider for Proton vehicles, Proton Commerce is committed to offer competitive financing rates for Proton customers. As Proton continues on its upward trajectory, Proton Commerce will continue to play a major role in ensuring more Malaysians are able to own a vehicle from Malaysia’s national automotive brand,” Mooi said.