ECONOMIC DOWNTURN The Automobile Association of Malaysia (AM) recently concluded its 54th annual general meeting that was held at Dewan Seng Peng, Wisma Chinese Chamber in Jalan Ampang on 28 March 2009. For the 2007/2008 financial year, the Association’s total income had increased, although only marginally to RM17,924,120 from the previous year’s RM17,614,083. Increase in revenue was reflected in three key areas; membership subscription, the sale of AAM trading merchandise and entrance fees. For the year under review, active card members throughout Malaysia stood at 234,889. Membership subscription fees collected grew from RM9,495,715 the previous year to RM9,982,475 during the year under review. This is attributed to continuous membership drives and renewal programmes being undertaken, and the introduction of new products such as the AAM A1 Team Malaysia and AAM Shape Lady’s cards.

Although designed to appeal to a niche market and only in its infancy stages, both new products contributed significantly and have successfully created another incomegenerating avenue for AAM. For the year under review, AAM had also responded to a total of 68,427 roadside assistance cases and attended to 31,266 calls from members as well as non-members. Insurance sales registered a slight dip in revenue, with sales amounting to RM 2.063 million compared to the preceding year’s RM 2.297 million. The drop was the result of serious competition among insurance companies that have also resorted to providing free road assistance packages to policy holders, the depreciation in the value insured for motor vehicles, and the gloomy economic slowdown that has stunted the growth of new vehicle sales.

More members however, are seen taking advantage of AAM’s vehicle inspection and evaluation service, and in the year under review, 2,722 vehicle evaluations were undertaken to contribute an income of RM118,090 to the Association. The Association’s total expenditure reduced slightly to RM18,295,173 from RM18,305,687 the previous year. AAM also posted an improved deficit of RM419,053 compared to the previous year’s figure of RM733,604. Addressing members in his speech, AAM Chairman Yang Mulia Tunku Mudzaffar Tunku Mustapha said that in moving forward, especially in the light of repercussions brought on by the global economic crisis and financial crunch, demands that AAM remain focused on enhancing and growing its core business. This will be done with extreme care, prioritizing areas that will complement and add significant value to the existing services currently being offered by AAM. “AAM pledges to become more aggressive in its approach and the marketing of its services, assures members that this will be done very carefully, weighing all factors that will promote growth against the need to exercise prudence,” said Tunku Mudzaffar. He added that equal importance will be given towards reducing operational costs further. Cost reduction however, does not mean AAM will compromise on its services to members but it will involve introducing processes that will make the association more efficient, reducing wastage and increasing productivity.