New vehicle sales in Malaysia rebounded by 10.2% to 47,089 units in April from 42,746 units a year earlier, according to registration data released by the Malaysian Automotive Association (MAA).

Last month's rise followed a weak first quarter for the local auto market when sales fell by 4% due to rising consumer caution ahead of the May general elections, the association said.

The vehicle market until now had failed to respond to a strong rebound in the country's GDP growth last year to 5.9% from 4.3% in 2016. The vehicle market fell by a further 0.6% to 576,635 units last year after a 13% decline to 580,124 units in 2016.

Sales in the first four months of the year were still 0.7% lower at 182,229 units, compared with 183,586 units in the same period of last year.

Vehicle production year to date increased by 12.7% to 198,053 units from 175,665 units previously.

The newly formed government under the former long serving prime minister Mahathir Mohamad confirmed this week he would implement his party's election pledge to scrap the goods and service tax (GST).

The GST, introduced by the outgoing government three years ago, will be withdrawn on 1 June.

Shares in major automotive groups including Proton jumped on the news with expectations that car prices will fall and domestic sales will rebound as a result of the tax change.

The new ruling party also said it would make revisions to the country's automotive policy which some expect could see the establishment of new national car companies targeting new technology segments such as electric/hybrid vehicles.