New vehicle sales in Malaysia fell by 6.9% to 49,985 units in March from 53,718 units a year earlier, according to registration data released by the Malaysian Automotive Association (MAA).

The vehicle market continued to struggle to recover from the 13% volume drop to 580,124 units in 2016, with sales in 2017 falling by a further 0.6% to 576,635 units despite a strong rebound in economic activity in the country.

GDP growth accelerated to 5.9% last year after a sharp slowdown to 4.3% in 2016.

First quarter sales fell by 4% at 135,140 units from 140,840 units in the same period of last year, driven lower by a 5.8% drop in passenger vehicle sales to 120,132 units.

The MAA said consumers remained cautious ahead of the country's general elections to be held in early May. 

Sales of commercial vehicle sales were almost 13% higher at 15,008 units in the same period, reflecting strong growth in economic activity.

The association still expects the overall market to grow by over 2% to 590,000 units this year, lifted by stronger demand in the second half of the year.

Vehicle production in the country was 0.9% higher at 49,796 units in March and more than 20% higher at 156,214 units in the first quarter of the year.

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