KUALA LUMPUR, July 24 (Reuters) - Malaysian passenger vehicle sales fell 12 percent to 161,265 units in the first six months of 2003, the Malaysian Automotive Association said on Thursday.
Car sales in the first five months of the year had fallen 9.5 percent.
The trade body has also forecast car sales to drop five percent to 342,000 units this year from 2002.
"As indicated earlier, market conditions in the first half of 2003 were not conducive for motor vehicle buyers as a result of the Iraq war and outbreak of SARS," said Aishah Ahmad, president of the Malaysian Automotive Association.
Car sales were expected to slow this year as buyers await lower prices, after low interest rates and a spate of new models boosted sales by 10 percent in 2002.
Falling used car prices and hopes of cheaper new cars cooled consumers' appetite, with expectations that the Malaysian auto industry's delayed entry into the Association of South East Asian Nations Free Trade Area (AFTA) in 2005 will make imported models more competitively priced.
Malaysian carmakers are uncertain over future car prices with the government pledging to slash high auto import duties, but without saying what non-tariff duties will be brought in to make up for lost revenue.