PETALING JAYA: Car sales are expected to remain solid in the second quarter of 2023, despite the fulfilment period in conjunction with the sales tax exemption expiring on March 31.
Healthy sales orders and aggressive marketing campaigns have automotive companies upbeat about their performance for the current quarter.
Bermaz Auto Bhd executive chairman Datuk Seri Ben Yeoh believes the group’s sales orders will still be strong, due to back order bookings and the recent launch of the company’s CX-30, which has been well received.
“The orders are still consistent despite the two months waiting time,” he told StarBiz.
Yeoh added that the CX-30 was previously sold as a completely-built-up unit, where the price point was much higher.
“With the completely-knocked-down programme, the retail price point is brought down and this is now attractive to potential buyers. The lower price point mitigates the sales tax incentives,” he said.
Yeoh said Bermaz Auto will continue to add value to ownership cost through its five-year free maintenance and warranty programmes.
“This will reduce the cost of ownership as owners will have their vehicles looked after for the next five years, despite inflationary cost on service and maintenance.”
Bermaz Auto is the franchise holder of Mazda in Malaysia and the Philippines, Kia in Malaysia and Peugeot (distributor) in Malaysia.
Meanwhile, a spokesman from UMW Toyota Motor Sdn Bhd (UMWT) said the company is confident that sales will continue to remain healthy in the second quarter of 2023.
“This is based on the encouraging outstanding bookings, as well as the positive response to the recently launched all-new Toyota Vios.”
The spokesman added that UMWT will continue to introduce competitive and exciting new models to meet its customers’ requirements.
“We are also offering the Toyota EZ Beli financing option for the purchase of selected Toyota models. The Toyota EZ Beli is a nine-year loan divided into a three-tier category for the convenience of our customers.”
Meanwhile, Malaysian Automotive Association (MAA) president Mohd Shamsor Mohd Zain told StarBiz that the outlook for the second quarter of 2023 is still positively supported by a stable economic outlook.
“Moving forward, the sustainability of the market performance will depend on Malaysia’s economic indicators, which in turn will impact market buying sentiment.”
Post the tax exemption period, Mohd Shamsor said MAA members will still continue with campaigns and provide value-added services to improve demand, while also providing more options to customers.
“Additionally, the government’s incentive on electrified vehicles such as hybrid electric vehicles and battery electric vehicles will further help the industry demand to grow.”
Total vehicle sales hit an all-time high in March, rising 8% year-on-year (y-o-y) to 78,849 units due to the fulfillment of bookings made during the sales exemption period.
Sales during the month were also spurred by the rush for deliveries by companies with their financial year ending March 31, as well as Hari Raya-related promotional campaigns.
On a y-o-y basis, a total of 70,958 units of passenger vehicles were sold last month, compared with 65,903 units in the previous corresponding period.
The number of commercial vehicles sold were also higher at 7,891 units last month, compared with 7,347 units in March 2022.
For the three-month period ended March 31, 2023, total industry volume (TIV) rose to 192,474 units compared with 159,846 a year earlier.
Yeoh said the first quarter of 2023 was a good beginning for Bermaz Auto.
“There were carry-over orders from last year and we were able to increase our local production to meet the outstanding orders. However, there are still some issues that need to be addressed.
“This is the supply situation from our principal manufacturer, who are still experiencing some difficulties in procuring critical electronic chips to meet our orders.”
Meanwhile, UMWT registered 25,219 units (comprising both Toyota and Lexus vehicles) in the first quarter of 2023, its highest first quarter sales ever.
For the first quarter of 2023, UMWT (Toyota and Lexus) registered 25,219 units, its highest ever first quarter sales, which is a 12.3% growth compared with the 22,447 units registered in the corresponding period of 2022.
“The sales performance is within our expectations,” said UMWT’s spokesman.
The first quarter of 2023 saw a number of local car companies recording stellar performances.
Proton Holdings Bhd saw its first-quarter 2023 sales soar 50.9% y-o-y to 40,287 units, with market share growing to an estimated 21.2%.
The national automotive company said that for March alone, 14,573 units (domestic and export) were sold, an increase of 3.8% over February and 11.9% more than the same month in 2022.
Meanwhile, Perodua announced record sales of 32,179 vehicles in March, while also manufacturing 33,666 units.
On a quarterly basis, Perodua said its production increased by 33.9% to 84,800 units compared with 63,325 units that were produced in the same quarter of 2022.
In terms of sales, Perodua’s registration rose by 27.5% to 78,564 units in the first three months of 2023 compared with 61,624 units in the same period last year.
Commenting on the vehicle sales performance in the first quarter of the year, Kenanga Research in a recent report said it is maintaining its 2023 TIV projection of 720,000 units, which is set to match the record levels achieved in 2022.
The research house said its optimism is supported by strong consumer confidence, stable economy and a healthy job market.
Kenanga Research said the affordability of motor vehicles, underpinned by the recent pause in the overnight policy rate hikes by Bank Negara, will also help to spur sales.
The research house added that the industry’s total bookings backlog has held up at a fairly strong level of 300,000 units, compared to bookings of 350,000 units three months ago despite heavy deliveries.
“This indicates sustained strong buying interest, lured by attractive new model launches by players,” it said.
Meanwhile, RHB Research believes new vehicle launches are set to drive new orders, going forward.
It said April’s TIV will likely be softer month-on-month compared with March, as carmakers are no longer in a rush to deliver the sales and service tax (SST)-exempt orders.
“Although TIV in the second quarter of 2023 (2Q23) may also soften against 1Q23’s high base, we note that the strong orders seen throughout 1Q23 should still translate into robust TIV throughout 2Q and 3Q23.”
The research house noted that it has been nine months since car buyers were able to place sales and services tax (SST)-exempt orders.
“We think customers have long adapted to the SST-inclusive prices. Furthermore, the new model launches this year (notably Perodua Axia, Proton X90 and Toyota Vios) continue to drive new orders. We maintain our 2023 TIV of 680,000 units,” said RHB Research.
