PETALING JAYA: Malaysia’s manufacturing industry operated at 79.8% of capacity in the fourth quarter of 2023 (Q4’23), down 0.4 percentage point from 80.2% in the corresponding quarter of 2022, Chief Statistician Datuk Seri Dr Mohd Uzir Mahidin said.

The lower capacity utilisation of the manufacturing industry was primarily attributable to decreases in the sub-sectors of petroleum, chemical, rubber & plastic products (-4.2 percentage points); and electrical & electronic products (-0.5 percentage point).

However, the capacity utilisation of the manufacturing industry improved from 79.4% recorded in the previous quarter, continuing the positive trend for two consecutive quarters.

Prior to the decline in December, the utilisation rate in the manufacturing industry exceeded 80% for two consecutive months, operating at 80.4% in October and 80.1% in November.

“The decline in the capacity utilisation rate in the fourth quarter of 2023 mirrored the trend of the manufacturing industrial production index, which slipped by 0.2% (Q3’23: -0.1%). The decrease in production capacity was primarily influenced by low demand, insufficient supply of materials and the repair & maintenance of machinery & equipment,” said Mohd Uzir.

He added that there were five sub-sectors that posted a capacity utilisation rate above 80% in Q4’23. The highest rate of 83.2% was recorded by the manufacture of non-metallic mineral products, basic metals & fabricated metal products sub-sector, marking a year-on-year increase of 4.5 percentage points, and this was followed by transport equipment & other manufactures with 82.2% (+1.7 percentage points).

Meanwhile, the manufacture of petroleum, chemical, rubber & plastics sub-sector operated at the lowest capacity with 77.9%, lessened by 4.2 percentage points. In comparison with the preceding quarter, all sub-sectors posted an increase except for the electrical & electronic products, which declined by 0.7 percentage point to 79.2%.

The capacity utilisation in export-oriented industries continued to decline for the fourth consecutive quarter, dropping by 2.1 percentage points year-on-year to 78.4% in Q4’23. The manufacture of coke & refined petroleum products recorded a deterioration of 9.6 percentage points to 76.1%. This was followed by the manufacture of textiles, which shrank by 7.7 percentage points to 76.9%.

In comparison with the previous quarter, the capacity utilisation rate in export-oriented industries increased slightly by 0.02 percentage point.

Nevertheless, the capacity utilisation rate of domestic-oriented industries remained vibrant, registering 82.8% in Q4’23 (+3.3 percentage points).

All industries in this segment posted an upward trend except for the manufacture of leather & related products which decreased by 10.9 percentage points to 81.9%. Compared with Q3’23, domestic-oriented industries registered an increment of 1.1 percentage points from 81.7%.

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