Frost & Sullivan remains positive on the Malaysian automotive industry and is predicting vehicle sales to grow by 4.2 per cent this year to reach 675,000 units.
Kavan Mukhtyar, partner and head of automotive transport practice, Asia-Pacific, at the growth consulting firm, said the projected increase in total industry volume was due to positive economic conditions and continuous investment flow.
He expects Malaysia’s gross domestic product to grow by about 5.4 per cent this year, fuelled by strong domestic consumption and improvement in exports.
He added that the government’s much-awaited National Automotive Policy, expected to be announced in mid-January, would also be the catalyst to take the industry forward through a two-pronged approach and transform Malaysia into a production hub for energy-efficient vehicles (EEVs) by 2020.
“There will be more clarity on the direction of the local automotive industry [after the] NAP announcement, which is the industry road map for improving competitiveness, increasing investments and export growth,” Mukhtyar said.
He added that incentives for EEVs were likely to cover a greater basket of vehicles instead of just petrol-electric hybrids, with localisation commitment having potential to reduce prices.
“There will also be a further increase in competitive activity, new model launches and more choices for customers,” he predicted.
However, Mukhtyar cautioned that continued tightening of credit and subsidy rationalisation would have a restraining effect on growth of vehicle sales.
Although automakers are likely to adopt a cautious approach and await policy clarity after the NAP announcement, low-emission and fuel-efficient models will remain popular with consumers, he said.
He added that key new model launches that can be expected this year included the Perodua Alza, Toyota Corolla Altis, Citroen DS3, Ford Fiesta EcoBoost, Hyundai i30 hatchback and Proton Global Small Car P2-30A among others.
Frost & Sullivan expects the final tally of last year’s vehicle sales in Malaysia to be 648,000 units, growing 3.2 per cent from 2012, mainly driven by continued positive consumer sentiment and the launch of several new models. These included the Proton Suprima S, Toyota Vios, and value-for-money models such as the Proton Saga SV and Perodua’s S-series.
“Lowered expectation of price reduction by consumers and full exemption of import and excise duty on hybrids also contributed to the growth,” Mukhtyar said.
He added that in the passenger-vehicle market, Perodua was expected to retain its leadership position with 33.8-per-cent market share last year thanks mainly to its new S-series. Proton could see its market share fall 1 percentage point despite the launch of the Saga SV and Suprima S.
Toyota’s market share is likely to have dropped to 10.6 per cent in 2013, from 13.4 per cent in 2012. This is largely because of the delayed launch of the new Vios, stock unavailability of Altis and fierce competition from other small cars such as Proton’s Prevé and Suprima S, the Nissan Almera, and the Honda Jazz CKD.
Honda’s aggressive presence in the market likely resulted in a 2.4-percentage-point jump in share because of the launch of the ninth-generation Accord, fourth-generation CR-V and new hybrid models.
Meanwhile, Nissan’s growth likely grew by 3 percentage points thanks to positive response to the Almera.
Mukhtyar said strong domestic demand in Malaysia aided the 2.2-per-cent year-on-year growth in commercial-vehicle sales to 77,300 units in 2013.
He added that Toyota’s best-selling Hilux pickup ensured its overall dominance in the commercial-vehicle market at 38.1 per cent last year.
Overall, Japanese automakers accounted for nearly 85 per cent of this market. Isuzu is projected to witness a marginal increase in 2013 share to 14.4 per cent with the launch of the new D-max in different trim levels.
Meanwhile, Ford is likely to see a 4.4-percentage-point jump in its share with its new 2.2-litre Ranger that is positioned as a tough yet stylish, high-performance pickup truck. Daihatsu and Hyundai-Inokom saw dips in market share due to more price-competitive Chinese vehicles in the light-truck segment.
Though Volvo and Scania continue to lead the heavy-truck segment, Chinese offerings such as Auman, Sinotruk, CAMC and Bei Ben have made some inroads, Mukhtyar said.