MITI’s U-Turn Means Car Factories Are Closed During MCO 2.0

With the announcement of MCO 2.0 that began on January 13th, 2021, it was originally thought that certain sectors of industry would also be allowed to operate alongside the usual set of essential services and operations.

However, MITI has now overturned their previous list that grouped automotive manufacturing with other (still) green lit activities such as assembly with showrooms, service centres, and other workshops, effectively halting any vehicle assembly or automotive manufacturing for the duration of this newest implementation of the Movement Control Order.

Keep in mind, though, that this isn’t a nationwide prohibition and pertains only to those within states that have been included in this more selective MCO, including Selangor, Penang, Malacca, Sabah, and the federal territories of Kuala Lumpur, Putrajaya, and Labuan.

As such, this directive won’t impact every automaker manufacturing or carrying out local assembly of cars in Malaysia. For example, Mazda’s CKD operations are entirely conducted in Kulim, Kedah. Similarly, the supply of certain Mercedes-Benz and Volkswagen cars that roll out of the DRB-HICOM plant in Pekan, Pahang won’t be affected. Mitsubishi's plant in Pekan should not be affected either. 

Other brands aren’t quite as lucky, though. Honda plant in Pegoh, Melaka is another facility that’s forced to shutter for the next two weeks, as are the ones - among other places - in Kuala Lumpur (Tan Chong Motor) and Shah Alam such as those operated by Toyota, Volvo, and Proton.

In fact, our national automaker might be the most set aback by the two week government mandated closure, exacerbating the already busy schedule brought on by the thousands of orders placed for the Proton X50. Luckily, its Tanjung Malim plant is still chugging along as normal, though it might have to deal with increased capacity.

Then again, merely having a factory remain operational might not matter if the automaker’s supply chain hinges on vendors that are within the mentioned states and are therefore unable to conduct business.

2021 doesn’t look like it’s letting us off easy with the challenges already coming in thick and fast by the second week of January. Here’s hoping that automakers, along with everyone else, manages to safely navigate these early year hurdles into more prosperous times ahead.