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For the first time since the late 1980s, Proton has not topped the list for the sales volume for a 6-month reporting period. Instead, it is No.2 national carmaker Perodua which appears as the leader in the total sales figures for new vehicles for the first six months of 2006. With a total volume of 79,738 vehicles sold, Perodua beat Proton by 19,447 units. Proton’s volume of 60,246 units was also about 21% down from the same 6-month period in 2005 but Perodua sold 30% more than the same period last year. Perodua also took the largest market share of 32.1% while Proton’s share was 24.3%.
Perodua’s ascent to top position is due largely to the enormous popularity of the Myvi model launched over a year ago and quite possibly a shift by consumers towards smaller, more fuel-efficient models as fuel prices have risen. It is also likely that disaffection for Proton models – due to inconsistent quality over many years – has discouraged many from buying its cars and instead turned to the next most affordable models which have been Peroduas.
As many had expected, the Malaysian auto market has lost its momentum and in the past few months, volumes have been slowing down. Today, the 6-month (H1) figures show just how much the decline has been – 248,407 units against 261,111 units in H1 2005 or a fall of 5%. The decline has been attributed to a few factors, among them the rise in fuel prices and also wariness on the part of the consumers because of global uncertainties. At the same time, stricter credit checks leading to less loans being approved as well as the fall in used car values which have affected trade-ins have also contributed to the market slowing down.
“The National Automotive Policy announced in March was a ‘spark’ to the current situation though not the direct cause,” said Datuk Aishah Ahmad, President of the Malaysian Automotive Association (MAA) which compiles market data. “As a result of the new tariff structure, prices of new vehicles dropped and this had the effect of also causing used car prices to fall. Thus it was an indirect result of the new tariffs that has been one of the factors.”
Datuk Aishah said that the challenging situation could well continue till the end of 2006 and feels that once consumers accept that the values of their cars are not as high as what they used to be, and start to make their purchases, the market will pick up again. She noted that this is the fourth time that the Malaysian auto market has experienced a decline. The first was in 1987 when the yen appreciated significantly while the second was in 1992 when the government revised the tax structure for certain segments. The third time was in 1998 due to the Asian economic crisis and was the most severe to date.
By sector in the Malaysian market for H1, passenger car (PC) sales totalled 184,725 units, less than the 199,554 units sold in H1 2005. The share of PC also dropped to 74% of the total industry volume (TIV) compared to 76% in 2005.
National passenger cars accounted for 114,060 units or a 78% share of the PC segment, larger in terms of share (75% in 2005) but smaller in terms of volume as the H1 volume in 2005 was 149,665 units. Proton’s share fell from 38% to 33% of the PC segment while Perodua’s share rose from 31% in 2005 to 42% in 2006.
In the commercial vehicle (CV) segment, 45,464 units were sold, an 18% share of the TIV for H1 2006 which was 1% higher than in 2005. It should, however, be noted that the models included in the CV segment include MPVs such as the Toyota Avanza and Innova, Naza Ria and even the Proton Juara. CVs such as lorries and vans used purely for commercial purposes actually account for a small volume. Non-national makes account for the larger share in this segment (73%) compared to national makes.
Since 1998, when the duties for 4WD models was raised, the 4WD segment has never been big again and for H1 2006, the total volume was 18,218 units or a 7% share of the TIV. This share was the same as 2005 when the segment volume was 17,900 units. In this segment too, non-national 4WD models sold more than the models of national makes (Perodua Kembara and Naza Sorento).
Overall, production at assembly plants was 2% higher in H1 2006 compared to H1 2005 for a total of 278,646 units. Though a large proportion would have been of the Perodua Myvi to meet the high demand, the national carmakers as a whole did not register higher production volume than H1 2005 but non-national carmakers increased output of their models by 7%. Proton’s output was 23% lower than in 2005 while Perodua’s was 23% higher.
While the data shows that most plants had lower production this year, the Naza plant in Kedah recorded as 102% increase in output as a result of the addition of new models to the line. ASSB, which assembles Toyota models (except the Avanza which is assembled at the Perodua plant) also increased output by 36% while MTB in Pekan produced 18% more vehicles due to the addition of Mercedes-Benz assembly.
LOOKING AHEAD
The MAA has revised its forecast downwards after seeing what has happened in H1 and from 565,000 units forecast at the beginning of the year, the figure is now 520,000 units, which will be 6% lower than what was registered for the whole of 2005. The association believes that PC sales will fall by 8% this year while CV and 4WD sales could increase by 1%.
The downturn is not confined to Malaysia as the main ASEAN market have also had similar declines during the past 6 months compared to the same period in 2005. Indonesia’s sales volume was down 49%; Thailand by 3.2%; and the Philippines by 3%. Singapore’s volumes rose by 3.2% and this is said to be due to the lower cost of the CoE (Certificate of Entitlement) which makes it cheaper to acquire new cars. The decline in the region is attributed to rising fuel prices although for Indonesia, there have also been economic issues.
http://www.motortrader.com.my/NUS/articles/0/article_546/page_m.asp
MAA lowers forecast for 2006 vehicle sales
By Goh Ee Koon
PETALING JAYA: After eight consecutive years of sales growth, Malaysia's motor vehicle industry may see figures dipping slightly this year.
Malaysian Automotive Association (MAA) president Datuk Aishah Ahmad said the association had revised its forecast for 2006 and that total vehicle sales would likely shrink 6% to 520,000 units.
The revision was made after sales declined 5% in the first half year versus a year earlier. Earlier this year, MAA had forecast a 2.5% growth in sales to 565,000 units.
“This slump is cyclical. Car sales also declined in 1998 and 1992 and data show sales picked up after those years. Thus, we are hopeful (the downward slide in) sales will begin to stabilise by year's end and we can hope to see some recovery in 2007,” Aishah said at a briefing yesterday.
The dip in sales is also indicative of what is happening around the region. During the first half year, car sales in Asean fell by 16.6%. Car sales in Indonesia fell 49%, while Philippines and Thailand saw falls of 3% and 3.2% respectively. Only Singapore registered growth, at 3.6%, as it is now cheaper to buy a car in the island nation.
In the January–June period, the total industry volume of vehicles sold was at 248,407 units compared with 261,111 in the equivalent period last year. Passenger cars, which make up 74% of the industry, saw 184,725 units sold, against 199,554 previously. Sales of national cars dropped 3.9% to 144,060 while non-national cars recorded a 22.7% drop in sales to 40,665 units.
Sales of Perodua cars, at 78,396 units, have also overtaken that of Proton's. It was a 22% increase from the first half of 2005, and Perodua now has a 42% market share in the passenger car segment.
Aishah said the main reason for Perodua taking over of the market leadership position was healthy sales of its best-selling Myvi model and that cost-conscious consumers were now opting for fuel-saving vehicles. Perodua also enjoyed better brand perception, she said.
In comparison, Proton sales dipped 26.1% to 60,246 units. It now has a market share of 33%.
Commercial vehicle sales grew 4% to 45,464 units. Aishah said this sector was set to continue growing for the rest of the year. As for 4WD vehicles, sales grew 2.2% to 18,218 units.
The overall production of national and non-national cars registered a 2% growth to 278,646 units.
On the outlook for the rest of the year, Aishah said MAA took into account a number of factors in revising its forecast, including weak used-car sales and low trade-in value, rising interest rates and difficult financing terms, as well as rising oil prices.
“We also took into account the higher inflation, estimated at 4%, the modest 5.5% growth in gross domestic product this year and more cautious consumer sentiment,” she added.
Aishah said it was hoped that the kick-off of the Ninth Malaysia Plan projects would trigger better sales as consumer sentiment improved as a side effect.
Analysts said it made sense to reduce the original forecast figures after the dismal January–June sales figures.
“Consumers are not getting easy financing and companies are not as bullish,” an analyst at a local research house told StarBiz. However, he agreed with MAA that sales would stabilise by the year-end. “Consumers need to get familiar with and adjust to the new conditions in the industry,” he said.
Another analyst said Proton's fortunes tended to partially reflect that of Edaran Otomobil Nasional Bhd (EON).
“EON tends to be marginalised by Proton Edar's business and the latter has been very aggressive in promotions and advertising, so it leaves EON on the losing end,” she said, referring to EON's recent decision to offer a voluntary separation scheme.
As the National Automotive Policy also encouraged more consolidation, she said it left a lot of room for mergers and acquisitions among the local car parts manufacturers, which numbered in the hundreds. Smaller car parts makers are feeling the crunch, as many supply parts to Proton and are indirectly affected by the company's poor sales. “There will come a time when some of the smaller manufacturers will be acquired or merged with larger ones, as a big share of the market is taken up by the big boys like Ingress Corp Bhd and EP Manufacturing Bhd,” she said, adding that car parts makers would also soon need to make parts for other brands to better insulate themselves from being overly reliant on just one brand.
http://biz.thestar.com.my/news/story.asp?file=/2006/7/28/business/14974680&sec=business
Sales of new vehicles may drop this year
28 Jul 2006
By Zuraimi Abdullah
KUALA LUMPUR: Sales of new vehicles may drop this year, the first time in eight years, amid cheaper second-hand cars, higher interest rates and stricter lending procedures, the Malaysian Automotive Association said.
MAA has reversed its earlier vehicles sales growth forecast of 2.5 per cent for this year to a six per cent contraction instead, after total industry volume (TIV) dropped five per cent in the first six months of the year.
MAA said 520,000 units of cars, vans and sports utility vehicles would be sold this year, lower than the 551,042 units sold in 2005 and also less than its own forecast of 565,000 units announced in January.
http://www.nst.com.my/Current_News/nst/Friday/National/20060728075447/car.JPG
Last year, Malaysia sold 13 per cent more vehicles than in 2004.
"We were not sure of the actual scenario in January. The industry is not strong right now, but the lower sales are not unique to Malaysia. All countries in Asean, with the exception of Singapore, recorded negative sales in the period," MAA president Datuk Aishah Ahmad told reporters yesterday.
Aishah and industry analysts said rising inflation, higher fuel prices, slower economic growth and cautious consumer sentiment also caused domestic car sales to wilt.
Used car sales directly affect new car purchases in the country because consumers normally sell them first before buying new ones.
Analysts said the value of used cars dropped after carmakers reduced prices of new vehicles following the Government’s National Automotive Policy.
MAA said a total of 248,407 new vehicles were sold in the first six months of 2006, down five per cent from the 261,111 sold within the same period of last year.
Passenger car sales accounted for 184,725 units of the total, down from 199,554 units a year ago. National cars made up 144,060 units out of the 184,725 units, down from 149,665 units previously.
Aishah said Malaysian car sales, which also suffered declines in 1986, 1992 and most recently 1998, may stabilise in the second half with sales, at the least, to be maintained from a year ago in a-best-case scenario.
"Things will stabilise by the beginning of the end of the year. After a certain time, consumers will begin to accept the reality that this is the price they will get. It won’t drag on too long like this," she said.
Amid depressed sales, there is a suggestion that Malaysia exports used vehicles to help address stock overhang issue.
"I have heard that Proton wanted to buy used Protons and export them as reconditioned cars," Nomura International (Hong Kong) Ltd analyst Nik Hadi Nik Mahmood said.
"But there are problems of quality and price, and whether foreign governments will allow used Malaysian vehicles to enter their market," Nik Hadi added.
Another suggestion from sectoral analysts is for the Government to provide incentives to reduce the current high rejection rate of car loans by finance companies.
http://www.nst.com.my/Current_News/nst/Friday/National/20060728075447/Article/local1_html
| http://www.motortrader.com.my/NUS/articles/0/article_546/a.JPG |
| Myvi helped propel Perodua ahead of Proton for the first time ever |
| http://www.motortrader.com.my/NUS/articles/0/article_546/b.jpg |
| Toyota Innova (pictured) and Avanza are classified in the CV segment and such MPVs account for the bulk of CV sales rather than lorries and vans used purely for commercial purposes |
| http://www.motortrader.com.my/NUS/articles/0/article_546/c.jpg |
| In the 4WD segment, non-national makes like this Nissan X-Trail sold better than the national models |
| http://www.motortrader.com.my/NUS/articles/0/article_546/d.jpg |
| Proton’s sales volume fell by around 21% compared to the same period in 2005 |
| http://www.motortrader.com.my/NUS/articles/0/article_546/e.jpg |
| Production volumes increased by 2%, with Perodua output rising by 23% in 2006 |
As many had expected, the Malaysian auto market has lost its momentum and in the past few months, volumes have been slowing down. Today, the 6-month (H1) figures show just how much the decline has been – 248,407 units against 261,111 units in H1 2005 or a fall of 5%. The decline has been attributed to a few factors, among them the rise in fuel prices and also wariness on the part of the consumers because of global uncertainties. At the same time, stricter credit checks leading to less loans being approved as well as the fall in used car values which have affected trade-ins have also contributed to the market slowing down.
“The National Automotive Policy announced in March was a ‘spark’ to the current situation though not the direct cause,” said Datuk Aishah Ahmad, President of the Malaysian Automotive Association (MAA) which compiles market data. “As a result of the new tariff structure, prices of new vehicles dropped and this had the effect of also causing used car prices to fall. Thus it was an indirect result of the new tariffs that has been one of the factors.”
Datuk Aishah said that the challenging situation could well continue till the end of 2006 and feels that once consumers accept that the values of their cars are not as high as what they used to be, and start to make their purchases, the market will pick up again. She noted that this is the fourth time that the Malaysian auto market has experienced a decline. The first was in 1987 when the yen appreciated significantly while the second was in 1992 when the government revised the tax structure for certain segments. The third time was in 1998 due to the Asian economic crisis and was the most severe to date.
By sector in the Malaysian market for H1, passenger car (PC) sales totalled 184,725 units, less than the 199,554 units sold in H1 2005. The share of PC also dropped to 74% of the total industry volume (TIV) compared to 76% in 2005.
National passenger cars accounted for 114,060 units or a 78% share of the PC segment, larger in terms of share (75% in 2005) but smaller in terms of volume as the H1 volume in 2005 was 149,665 units. Proton’s share fell from 38% to 33% of the PC segment while Perodua’s share rose from 31% in 2005 to 42% in 2006.
In the commercial vehicle (CV) segment, 45,464 units were sold, an 18% share of the TIV for H1 2006 which was 1% higher than in 2005. It should, however, be noted that the models included in the CV segment include MPVs such as the Toyota Avanza and Innova, Naza Ria and even the Proton Juara. CVs such as lorries and vans used purely for commercial purposes actually account for a small volume. Non-national makes account for the larger share in this segment (73%) compared to national makes.
Since 1998, when the duties for 4WD models was raised, the 4WD segment has never been big again and for H1 2006, the total volume was 18,218 units or a 7% share of the TIV. This share was the same as 2005 when the segment volume was 17,900 units. In this segment too, non-national 4WD models sold more than the models of national makes (Perodua Kembara and Naza Sorento).
Overall, production at assembly plants was 2% higher in H1 2006 compared to H1 2005 for a total of 278,646 units. Though a large proportion would have been of the Perodua Myvi to meet the high demand, the national carmakers as a whole did not register higher production volume than H1 2005 but non-national carmakers increased output of their models by 7%. Proton’s output was 23% lower than in 2005 while Perodua’s was 23% higher.
While the data shows that most plants had lower production this year, the Naza plant in Kedah recorded as 102% increase in output as a result of the addition of new models to the line. ASSB, which assembles Toyota models (except the Avanza which is assembled at the Perodua plant) also increased output by 36% while MTB in Pekan produced 18% more vehicles due to the addition of Mercedes-Benz assembly.
LOOKING AHEAD
The MAA has revised its forecast downwards after seeing what has happened in H1 and from 565,000 units forecast at the beginning of the year, the figure is now 520,000 units, which will be 6% lower than what was registered for the whole of 2005. The association believes that PC sales will fall by 8% this year while CV and 4WD sales could increase by 1%.
The downturn is not confined to Malaysia as the main ASEAN market have also had similar declines during the past 6 months compared to the same period in 2005. Indonesia’s sales volume was down 49%; Thailand by 3.2%; and the Philippines by 3%. Singapore’s volumes rose by 3.2% and this is said to be due to the lower cost of the CoE (Certificate of Entitlement) which makes it cheaper to acquire new cars. The decline in the region is attributed to rising fuel prices although for Indonesia, there have also been economic issues.
http://www.motortrader.com.my/NUS/articles/0/article_546/page_m.asp
MAA lowers forecast for 2006 vehicle sales
By Goh Ee Koon
PETALING JAYA: After eight consecutive years of sales growth, Malaysia's motor vehicle industry may see figures dipping slightly this year.
Malaysian Automotive Association (MAA) president Datuk Aishah Ahmad said the association had revised its forecast for 2006 and that total vehicle sales would likely shrink 6% to 520,000 units.
The revision was made after sales declined 5% in the first half year versus a year earlier. Earlier this year, MAA had forecast a 2.5% growth in sales to 565,000 units.
“This slump is cyclical. Car sales also declined in 1998 and 1992 and data show sales picked up after those years. Thus, we are hopeful (the downward slide in) sales will begin to stabilise by year's end and we can hope to see some recovery in 2007,” Aishah said at a briefing yesterday.
The dip in sales is also indicative of what is happening around the region. During the first half year, car sales in Asean fell by 16.6%. Car sales in Indonesia fell 49%, while Philippines and Thailand saw falls of 3% and 3.2% respectively. Only Singapore registered growth, at 3.6%, as it is now cheaper to buy a car in the island nation.
In the January–June period, the total industry volume of vehicles sold was at 248,407 units compared with 261,111 in the equivalent period last year. Passenger cars, which make up 74% of the industry, saw 184,725 units sold, against 199,554 previously. Sales of national cars dropped 3.9% to 144,060 while non-national cars recorded a 22.7% drop in sales to 40,665 units.
Sales of Perodua cars, at 78,396 units, have also overtaken that of Proton's. It was a 22% increase from the first half of 2005, and Perodua now has a 42% market share in the passenger car segment.
| http://biz.thestar.com.my/archives/2006/7/28/business/p3-carch.JPG |
In comparison, Proton sales dipped 26.1% to 60,246 units. It now has a market share of 33%.
Commercial vehicle sales grew 4% to 45,464 units. Aishah said this sector was set to continue growing for the rest of the year. As for 4WD vehicles, sales grew 2.2% to 18,218 units.
The overall production of national and non-national cars registered a 2% growth to 278,646 units.
On the outlook for the rest of the year, Aishah said MAA took into account a number of factors in revising its forecast, including weak used-car sales and low trade-in value, rising interest rates and difficult financing terms, as well as rising oil prices.
“We also took into account the higher inflation, estimated at 4%, the modest 5.5% growth in gross domestic product this year and more cautious consumer sentiment,” she added.
Aishah said it was hoped that the kick-off of the Ninth Malaysia Plan projects would trigger better sales as consumer sentiment improved as a side effect.
Analysts said it made sense to reduce the original forecast figures after the dismal January–June sales figures.
“Consumers are not getting easy financing and companies are not as bullish,” an analyst at a local research house told StarBiz. However, he agreed with MAA that sales would stabilise by the year-end. “Consumers need to get familiar with and adjust to the new conditions in the industry,” he said.
Another analyst said Proton's fortunes tended to partially reflect that of Edaran Otomobil Nasional Bhd (EON).
“EON tends to be marginalised by Proton Edar's business and the latter has been very aggressive in promotions and advertising, so it leaves EON on the losing end,” she said, referring to EON's recent decision to offer a voluntary separation scheme.
As the National Automotive Policy also encouraged more consolidation, she said it left a lot of room for mergers and acquisitions among the local car parts manufacturers, which numbered in the hundreds. Smaller car parts makers are feeling the crunch, as many supply parts to Proton and are indirectly affected by the company's poor sales. “There will come a time when some of the smaller manufacturers will be acquired or merged with larger ones, as a big share of the market is taken up by the big boys like Ingress Corp Bhd and EP Manufacturing Bhd,” she said, adding that car parts makers would also soon need to make parts for other brands to better insulate themselves from being overly reliant on just one brand.
http://biz.thestar.com.my/news/story.asp?file=/2006/7/28/business/14974680&sec=business
Sales of new vehicles may drop this year
28 Jul 2006
By Zuraimi Abdullah
KUALA LUMPUR: Sales of new vehicles may drop this year, the first time in eight years, amid cheaper second-hand cars, higher interest rates and stricter lending procedures, the Malaysian Automotive Association said.
MAA has reversed its earlier vehicles sales growth forecast of 2.5 per cent for this year to a six per cent contraction instead, after total industry volume (TIV) dropped five per cent in the first six months of the year.
MAA said 520,000 units of cars, vans and sports utility vehicles would be sold this year, lower than the 551,042 units sold in 2005 and also less than its own forecast of 565,000 units announced in January.
http://www.nst.com.my/Current_News/nst/Friday/National/20060728075447/car.JPG
Last year, Malaysia sold 13 per cent more vehicles than in 2004.
"We were not sure of the actual scenario in January. The industry is not strong right now, but the lower sales are not unique to Malaysia. All countries in Asean, with the exception of Singapore, recorded negative sales in the period," MAA president Datuk Aishah Ahmad told reporters yesterday.
Aishah and industry analysts said rising inflation, higher fuel prices, slower economic growth and cautious consumer sentiment also caused domestic car sales to wilt.
Used car sales directly affect new car purchases in the country because consumers normally sell them first before buying new ones.
Analysts said the value of used cars dropped after carmakers reduced prices of new vehicles following the Government’s National Automotive Policy.
MAA said a total of 248,407 new vehicles were sold in the first six months of 2006, down five per cent from the 261,111 sold within the same period of last year.
Passenger car sales accounted for 184,725 units of the total, down from 199,554 units a year ago. National cars made up 144,060 units out of the 184,725 units, down from 149,665 units previously.
Aishah said Malaysian car sales, which also suffered declines in 1986, 1992 and most recently 1998, may stabilise in the second half with sales, at the least, to be maintained from a year ago in a-best-case scenario.
"Things will stabilise by the beginning of the end of the year. After a certain time, consumers will begin to accept the reality that this is the price they will get. It won’t drag on too long like this," she said.
Amid depressed sales, there is a suggestion that Malaysia exports used vehicles to help address stock overhang issue.
"I have heard that Proton wanted to buy used Protons and export them as reconditioned cars," Nomura International (Hong Kong) Ltd analyst Nik Hadi Nik Mahmood said.
"But there are problems of quality and price, and whether foreign governments will allow used Malaysian vehicles to enter their market," Nik Hadi added.
Another suggestion from sectoral analysts is for the Government to provide incentives to reduce the current high rejection rate of car loans by finance companies.
