Malaysian automotive market to grow in 2018
> Vehicle sales projected to reach 601,000 units on the back of positive economic growth: Frost & Sullivan
KUALA LUMPUR: Frost & Sullivan has forecast Malaysia’s vehicle sales to reach 601,000 units in 2018 at a growth rate of 2%, on the back of positive economic growth driving consumer confidence throughout the year.
Frost & Sullivan senior vice-president of mobility Vivek Vaidya said the strengthening ringgit is likely to reduce the import costs of parts and complete built-up models, helping contribute to price stabilisation in 2018.
He said the launch of the Perodua Myvi in the second half of 2017 as well as the launch of key models, including the Toyota CH-R in 2018, will drive sales in 2018.
Infrastructure projects will also push the sales of commercial vehicles.
“We expect 2018 to be a positive year. We expect that there will be a marginal growth in 2018,” Vivek said when presenting the Malaysian automotive outlook for 2018 yesterday.
However, he said stringent hire purchase approvals, high household debt, the National Automotive Policy, improvement in public transport as well as the growth of ridesharing will impact the automotive market in Malaysia in the long term, but are unlikely to have any significant impact in 2018.
“We think markets have bottomed out. Negative growth has stopped and (growth) has started going up.”
Frost & Sullivan has projected total industry volume to come in at 589,209 units in 2017, up by 1.6% from 2016.
“Malaysia is a mature market. We don’t expect a double digit growth. A good single digit growth rate of anywhere between 2% and 5% is something that we’re expecting to happen,” said Vivek.
He added that the entry of Chinese strategic partner Zhejiang Geely Holding Group Co Ltd into Proton Holdings Bhd will see more new models being launched under the Proton brand, resulting in a better dealer network in Malaysia, better access to technology and more cost competitiveness.
“Many Proton dealers are upgrading their facilities from 3S to 4S. The strong standardisation across Proton’s network will improve the customer experience, dealership standards and infrastructure,” explained Vivek.
He said Geely’s intervention will also provide better access to technology and result in the lowering of costs.
“Malaysian cars are good but lack scale, so the price tends to be higher. Now with Geely working with Proton, one model has a wider base of sales globally and the same model can be available at a cheaper price.”