KUCHING: The year has been very eventful for multipurpose vehicles (MPVs) as Proton and Perodua introduced their first ever MPV variants to the market.According to OSK Research Sdn Bhd, while the temporary scrapping incentive did little to boost total industry volume (TIV) given the poor take-up rate due to the meagre RM5,000 rebate, the TIV numbers were unexpectedly decent, declining only 7.5 per cent year-to-date (YTD).
The key events for 2009 for the automotive sector revolved around the stimulus measures announced with the scrapping policy due to end this year and the unexpected increase in hire purchase rates for nonnational cars.
The research firm speculated that there will be a lack of new hot selling models for launch next year other than Proton’s new Waja (a rebadged Lancer Fortis). Tan Chong would be looking at launching its CKD version of the Teana, a D-segment sedan sometime in the first half of 2010, along with the release of the Myvi replacement by first half of 2011 as its five year lifespan expires.
At the end of 2011/early 2012, Tan Chong might also explore the possibility of bringing in a CKD model to introduce its new line-up in the A and B segments. Similarly over the same horizon, Proton will also be looking at launching a new global sedan, designed by an Italian design house which is credited with many motoring beauties.
It welcomed the new measures proposed in the NAP to transform the local automotive industry into a regional hub over the longer term with giveaways such as corporate tax holidays and tax exemption on exported goods to lure global original equipment manufacturers (OEMs).
While the incentives will benefit the industry overall, it foresaw Proton as the clear winner given that the ample capacity at its Shah Alam plant can potentially be taken up by global OEMs. For this, the immediate beneficiaries would be the Tier-1 autopart suppliers across the industry supply chain should global OEMs establish their export hubs here for the Asean region.
Noting that Thailand is an automotive hub for American and Japanese car makers, the research firm saw the potential of Malaysia trying to attract the European car makers, noting the recent relaxation on equity conditions for manufacturers in the luxury passenger car segment.
This fortified its view that a partnership between Proton and Volkswagen is bound to materialise any time soon.
Despite the late initiatives in luring global OEMs to set up manufacturing hubs in Malaysia, it opined that opportunities still abounded in attracting other global OEMs to set up a hybrid manufacturing hub here. There was also possibilities of OEMs manufacturing hybrid/electric vehicle related parts or components to leverage on their existing CKD assembly lines.
Proton’s recent collaboration with Detroit Electric could also see the former diversifying its line-up by offering electric-charged vehicles locally based on the Gen2 and Persona platforms once the right infrastructure is in place, it said.
The research firm reiterated that 2010 was an exciting year as it expected to see more developments in the industry. While this may not have any immediate impact in boosting TIV, it continued to maintain its TIV growth projection of 3.7 per cent growth for 2010 (of 518,360 units from 500,000 projected in 2009). It highlighted that the key risks were the lack of new models to lift TIV and higher financing cost due to potential OPR hike in 2010.
Nevertheless, the research firm was optimistic on the longer term prospects of the industry going forward. Its top pick for the sector was Proton for being a prime beneficiary of the NAP in addition of its upcoming announcement of a strategic partnership.
OSK Research also recommended exposure to autoparts suppliers which stand to gain with the entry of global OEMs.
The ban on imports of used parts from June 2011 will see New Hoong Fatt reaping higher revenues given the attractive pricing of its replacement equipment manufacturer (REMs) products for cost-concious consumers as an alternative choice to pricier OEM autoparts.