KUCHING: Malaysia’s automotive sector’s sales volume in the coming months is expected to remain buoyant on value-for-money offerings from Proton and Perodua in addition to important new model launches from non-national marques.
Analyst Alexander Chia of RHB Research Institute Sdn Bhd (RHB Research) highlighted this in a recent note, after reporting that sales data in July was the highest monthly sales volume achieved by the market.
To note, the cumulative total industry volume (TIV) was up 5.9 per cent year-on-year (y-o-y) to 381,919 units and is the second consecutive monthly gain.
“A strong sales month had been expected, given attractive promotional offers and the seasonally stronger demand ahead of the Aidil Fitri holidays.
“We believe there was also some element of pent-up demand, given that some buyers had held back on their purchase decisions in the preceding quarter owing to the General Election and talk of lower car prices,” the analyst outlined.
Chia, however, noted that with the shorter working month in August, auto sales will likely moderate.
Meanwhile, on the automotive sector performance in July, the analyst recapped, Proton sales reached their second highest ever monthly total of 16,629 units (an increase of 53.9 per cent quarter-on-quarter; an 29.6 per cent increase y-o-y), bettered only by the 17,505 units sold in March 2011.
“The strong sales were sparked by overwhelming demand for the Proton Saga SV, which we understand has already garnered over 24,000 orders,” Chia added.
While the analyst noted his concern over Perodua which could be affected by Proton’s strong sales, it too posted a strong month, with sales up 21.5 per cent month-on-month (m-o-m) and 12.6 per cent y-o-y to 19,152 units on strong demand for the Perodua S-Series models.
“Continued strong demand for these value-for-money models from the national car manufacturers could significantly lift the total industry volume (TIV). The market share for national cars spiked higher to 52.3 per cent in July, up from 49.5 per cent in June and 50.2 per cent last July,” Chia said.
Meanwhile, on Malaysia’s non-national marque, the analyst explained that Honda recorded the strongest m-o-m rebound in the non-national category, with sales up 86.8 per cent to 6,038 units.
“This was likely due to the launch of the locally assembled Jazz, Honda’s cheapest model at RM74,800,” he said, adding that Nissan also had a good month while Toyota clawed back lost ground.
Looking ahead, Chia said July TIV is likely to have been the peak sales month for 2013, but it is a good start and in line with the RHB Research’s base case expectations for stronger auto sales in the second half of 2013.
“We are relieved that Bank Negara has officially refuted market rumours of a clamp down in auto financing.
“However, currency trends are going against the sector, with auto stocks likely to remain out of favour until portfolio flows stabilise,” Chia concluded.