New product launches for key players

MIDF Research pointed out that another key driver for sector earnings in 2H17 is a pickup in new product launches, particularly volume drivers for the key players.

The research arm noted that among the key new models to come include the Honda Jazz (launched in June), Mazda’s new CX5 and CX9 (in October and July respectively), Toyota’s indicative four new models (all in 2H17) and possibly a new MyVi from Perodua (also in 2H17, based on its channel checks).

“Proton meanwhile has tied up with Geely and the first model to be born out of this partnership is Proton’s first SUV model to be based on Geely’s Boyue.

“No timeline has been given for the launch but our guess is this is likely to come earliest in late 2017, depending on depth of localisation,” the research arm said.

It added that Proton also launched an improved version of the Iriz (more refined comfort, minor exterior and interior enhancements and a retuned ECU, TCU and a new exhaust system) in June.

The research arm expected these to drive a marked improvement in total industry volume (TIV) from July onwards.

Overall, MIDF Research revised up its 2017 TIV forecast to 595,928 units from 589,000 previously on the back of an upward revision in our in-house GDP forecast to 5.1 per cent from 4.9 per cent.

The research arm now expected 2017 TIV to grow by 2.7 per cent from 1.5 per cent.

“Echoing our more positive view, the Malaysia Automotive Association also indicated of possible upside to its 2017 TIV forecast of 590,000 units,” the research arm said.