In a statement, Chief Statistician Uzir Mahidin said a lower capacity utilisation of the manufacturing industry was primarily attributable to decreases in the sub-sectors of petroleum, chemical, rubber, and plastic products (-4.2%); as well as electrical and electronic products (-0.5%).
The manufacturing industry operated at 79.4% capacity utilisation in Q3 2023, down 1.9% year-on-year (y-o-y) while expanding every quarter.
He noted that the utilisation rate in the manufacturing industry exceeded 80% for two consecutive months, operating at 80.4% in October 2023 and 80.1% in November 2023, while the capacity utilisation rate for December 2023 dropped to 78.9%.
“The decline in the capacity utilisation rate in Q4 2023 mirrored the trend of the manufacturing industrial production index, which slipped by 0.2% (Q3 2023: -0.1%).
“The decrease in production capacity was primarily influenced by low demand, insufficient supply of materials, as well as the repair and maintenance of machinery and equipment,” Uzir said.
Five sub-sectors posted a capacity utilisation rate above 80% in Q4 2023 with the highest rate of 83.2% recorded by the manufacture of non-metallic mineral products, basic metals, and fabricated metal products sub-sector, with a y-o-y increase of 4.5%.
This was followed by transport equipment and other manufactures with 82.2%.
Meanwhile, the manufacture of petroleum, chemical, rubber, and plastics sub-sector operated at the lowest capacity with 77.9%, reducing by 4.2%.
In comparison with the preceding quarter, all sub-sectors posted an increase except for the electrical and electronic products, which declined by 0.7% to 79.2%.
As for the capacity utilisation in export-oriented industries, Uzir pointed out that it continued to decline for four consecutive quarters, dropping by 2.1% points y-o-y to 8.4% in this quarter.
“The manufacture of coke and refined petroleum products recorded a substantial deterioration of 9.6%, reaching 76.1%, followed by the manufacture of textiles, which shrank by 7.7% to 76.9%,” he said.
In comparison with the previous quarter, the capacity utilisation rate in export-oriented industries increased slightly by 0.02%.
Uzir said the capacity utilisation rate of domestic-oriented industries remained vibrant, registering 82.8% in Q4 2023 (+3.3% points) with all industries in this segment posting an upward trend except for the manufacture of leather and related products which decreased by 10.9% to 81.9%.
At the state level, Uzir said that in Q4 2023, the manufacturing industry in six states operated at a capacity exceeding the national rate, namely Labuan (95.6%), Negeri Sembilan (83.8%), Pahang (83.7%), Selangor (82.1%), Melaka (81.9%) and Johor (81.8%).
Six states experienced a y-o-y decrease in capacity utilisation, namely Kedah, Kelantan, Melaka, Perlis, Terengganu and Sarawak.