Auto sector: National cars could gain market share in FY19F
KUCHING: The automobile or automotive sector may see national cars gaining market share in financial year 2019 forecast (FY19F), analysts opine in their 2019 outlook reports.
According to the research arm of MIDF Amanah Investment Bank Bhd, given major launches in the next six months, national cars could gain market share in FY19F.
“Proton is expected to officially launch its maiden SUV model, the X70, in December 2018 (based on Geely’s Boyue model) -- initially as completely built up (CBU), but later to be locally assembled -- targeted in the first half of 2019 (1H19).
“The CBU version (sold in four variants, all with 1.8 litre turbo engines) has been reported to entail a price range of RM90,000 to RM130,000, positioning it to take share off the non-nationals,” MIDF Research said.
It noted that these non-nationals included the top of the line B-segment such as high-spec Toyota Vios, high-spec Honda City, Mazda 2; low spec C-segment models such as lower variants of Honda Civic, Toyota Altis, Mazda 3; and B-segment SUVs - mainly the Honda HRV and Mazda CX3.
AmInvestment Bank Bhd (AmInvestment Bank) highlighted that both national carmakers will launch their first SUVs with different priorities. “Perodua will focus on sales while Proton will focus on improving the consumer perception. Proton will rely on the SUV to test the various operational reforms and processes that are being introduced to win back consumer confidence,” AmInvestment Bank said.
The research firm believed that the X70 requires a strong success story in the home market before expanding regionally.
It expected Perodua to follow suit and target the more affluent segment where the financing options are said to be more secure.
“Both players are looking to position themselves on more formidable ground by reducing their dependence on volume over time.”
MIDF Research expected Perodua’s SUV to be more competitively priced as it seeks to compete against the X70.
As these SUVs essentially expands the national cars’ product line, the research arm estimated Proton to see market share expand to 13.9 per cent, compared to 12 per cent in FY18F.
However, MIDF Research noted that so far this year, Proton has underperformed the research arm’s forecast of 72,000 units.
As for Perodua, MIDF Research has yet to factor in its new SUV into projections for UMW Holdings Bhd and MBM Resources Bhd pending a more concrete decision on the launch timing.