Catalist-listed MeGroup will be setting up a used car dealership, to be operational from 1 January 2022.
The dealership is for the sale of various automobile brands.
The group will also be setting up a new manufacturing facility in Kulim Hi-tech Park in Kedah, where it will see the expansion of MeGroup's components manufacturing line.
Construction of the facility is expected to be completed and operational by the 1QFY2023.
The hub will cater to MeGroup’s customers located in the northern part of Malaysia. It is also said to reduce any latent delivery delays from the main manufacturing plant in Selangor.
“This facility will be particularly important to the group as it caters to our customers based in Northern part of Malaysia. Given these developments, we believe that our manufacturing business is poised to recover in 2022,” says Carol Wong, executive director of MeGroup.
See: MeGroup adds Proton to dealership portfolio
In the same statement, the group announced that its installation of solar panels at the main manufacturing plant is about 90% complete. It had previously announced that it was embarking on an energy saving initiative through the use of solar panels.
Upon completion, MeGroup expects to see an immediate cost savings in its overhead expenses.
In addition, the group has completed automation of its first manufacturing line in the main manufacturing plant. It is in the process of converting a second manufacturing line.
“Through utilisation of renewable energy like solar and improving product quality using automated manufacturing lines, we are able to maximise cost savings through reduced electricity usage and product wastage. Over time, we hope to achieve at least 70% automation in our main manufacturing plant compared with the current 25%,” says Wong.
On the Covid-19 pandemic, Wong says the group’s manufacturing plants and dealership outlets have remained fully operational in Malaysia.
“On a group level, we have established a Covid-19 special task force to oversee, implement, and monitor Covid-related protocols and measures to safeguard our workplace and the wellbeing of our staff.”
“In diversifying the group’s income stream, the dealership business will be setting up a used car dealership. This new segment will add on to our current dealership business’ overall revenue contribution, and we hope to keep growing our used car segment ” she adds.
Shares in MeGroup closed flat at 15 cents on Oct 8.
(This article has been updated to reflect MeGroup's own clarification to its own announcement)
Photo: Stock photo
