Malaysia's vehicle sales forecasted to grow 1.2%

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KUALA LUMPUR: Frost & Sullivan (M) Sdn Bhd expects Malaysia's total industry volume (TIV) to increase to 612,000 units this year from an estimated 605,000 units last year.

The bleak forecast is attributed to an uncertain global economic outlook, limited new mass market model launches and concerns on loan approval rate.

Frost & Sullivan partner and head of the automotive and transportation practice, Asia Pacific Kavan Mukhtyar (pic) said: “TIV in 2012 will be driven by the C-segment (mid-sized sedans) supported by growth in the D-segment (premium and large sedans).

He added that hybrids will continue on a high growth path in 2012 due to the extended duty exemption, new models in the pipelines, decreasing price gap between hybrids and non-hybrids and growing customer acceptance.

“Gasoline fuelled vehicles are probably just 15% to 20% cheaper than hybrids of equivalent range. It makes financial sense for consumers to go for fuel efficient hybrid vehicles,” he said.

Kavan predicts hybrid sales for 2012 to increase by 60.9% to 13,400 units.

Frost & Sullivan also predicts the D-segment to be the fastest growing segment, increasing 23% year-on-year to 35,000 units in 2012, driven by recovery sales as the automotive supply chain returns to normalcy after disruptions due to the Japan tsunami and Thailand floods last year.

Last year the disruption caused the segment to fall 30.2% to 28,692 units. The discontinuation of the Proton Perdana also contributed to the decline.

“The expected launch of new key models such as Toyota Camry, Kia Optima, Volvo V60 and BMW M5 is also likely to drive sales in the D-segment for this year,” said Kavan.

Sales in the B-segment are predicted to grow 2.2% year-on-year to 98,800 units this year, driven by the Perodua Myvi, Suzuki Swift and Ford Fiesta.

Stringent loans and credit control are predicted to affect the purchase of entry-level vehicles in the A and B segments.

“While A-segment (small and compact cars) continues to shrink due to limited models offered, B and C-segments are seeing good demand as first time buyers opt directly for these models than going for the A-segment,” said Kavan.

Sales in the C-segment are expected to increase 3.8% year-on-year to 238,300 units this year due to key new launches namely Proton P3-21A, Hyundai Elantra and Honda Civic, along with the robust sales from Proton Saga and increasing sales of hybrids.

Demand for multi-purpose vehicles (MPVs) is expected to decline 10.1% year-on-year to 83,100 units this year as customers experience model fatigue.

Sales for sports utility vehicles (SUVs) are likely to grow 11% year-on-year to 25,900 units due to a range of new models such as Livina X-Gear, Santa Fe, Kia Sportage, Hyundai Tucson and Mitsubishi Pajero Sports VGT.

Last year SUVs saw strongest sales among all segments increasing 49.5% year-on-year driven by sales of Hyundai Tucson, Mitsubishi ASX, Hyundai Santa Fe and Nissan Livina X-gear as consumers switched from D-segment due to supple chain constrains.

Frost and Sullivan found that in the passenger vehicle market, Perodua (Perusahaan Otomobil Kedua Sdn Bhd) maintained its pole position last year with an estimated 34.3% market share.

Proton Holdings BhdÂ's market share in same category grew 0.2% to an estimated 29.1% due to robust sales of Saga, Persona and Inspira.

ToyotaÂ's market share in the category is like to decline by 1.2% to 11.9% last year while Honda likely to see a decline of 2% to 6.2% due to Japan and Thailand natural disasters.

Kia and Hyundai are slowly gaining market share supported by the launch of their new SUVs.

Toyota continued its dominance in the commercial vehicle segment with a 36.8% market share last year due to strong sales in the pick-up truck segment through Toyota Hilux.

Isuzu on the other hand is likely to increase market share in the same category by 3.7% to 13.7% driven by the introduction of the N-series light truck.

NissanÂ's market share likely declined 3% to 10.4% due to discontinuation of its best-selling Vanette.

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