Luxury models shining in a very tight market

By MAJ

Six months into 2017 and total vehicles sales have inched 3.3% higher to 284,461 units compared to 275,483 units recorded a year ago. For analysts and industry watchers, the 8,978-unit rise was a relief. After last year’s disappointing full-year performance, the rise in the last few months has brought some flicker of hope.

It is, however, a far cry from the apogee: The record-breaking 666,674 units sold in 2015. It is a record that is not expected to be eclipsed anytime soon.

The vehicle industry sold 627,753 units in 2012, 655,793 (2013) and 666,465 (2014). The Malaysian Automotive Association is still maintaining its total industry volume (TIV) forecast of 590,000 units for this year. Sales achieved for the six-month period is only 48.2% of the forecast.

Favourable economic outlook, higher disposable income, consumer sentiment, employment rate, financing, inflation and entry of new models are the catalysts for the sector.

June figure shows sales volume dropped by 7,087 units to 50,275 units compared to 57,362 units in the same month last year despite the Hari Raya Aidilfitri celebration, traditionally a time people flock to the salesroom. Despite the drop, vehicles sales for the first five months had surpassed last year’s sales for the five respective months.

Overall industry figure shows the state of the sector. For the period of January till June, the industry sold 255,749 cars. A closer look into the industry’s performance shows a few carmakers continue to register a strong interest among buyers.

The Honda Story

Honda continued to post a strong performance for the January-June 2017 period, continuing its sterling performance last year. For the period, Japan’s second-largest carmaker sold 52,527 vehicles in Malaysia, taking an 18.5% market share and becoming the second bestselling car in the country. For the passenger vehicle segment, it garnered a comfortable 20.2% market share. This means for every 10 passenger cars sold, two are from Honda.

For the passenger vehicle segment, Honda garners a comfortable 20.2% market share (Pic by Muhd Amin Naharul/TMR)

Honda’s January-June 2017 performance had outclassed its 39,654 units achieved during the same period last year. Interests in the Civic, Jazz, BRV and the recently launch CRV will continue to push Honda to sustain its position as the No 2 carmaker this year. Its broad range of offerings especially in the compact SUV market will likely ensure Honda’s dominance.

Proton’s Recovery

All eyes will certainly be on Proton Holdings Bhd. The announcement of a stake sale to Zhejiang Geely Holding Group Co Ltd has not impacted the national carmaker.

Proton delivered 39,393 cars to customers during the first six months, owning a 15.4% market share of the passenger car market. The half-year performance was 3,666 units more compared to 35,727 units recorded last year.

With promotions like a 5-year service including parts and warranty on parts, Proton is expected to deliver a better full-year figure this year (Pic by Muhd Amin Naharul/TMR)

While sceptics may find it easy to aim their guns at Proton, the national carmaker’s current models especially the Saga and Persona are gaining back some confidence. With promotions like a five-year service including parts and warranty on parts, Proton is expected to deliver a better full-year figure this year.

Supporters and detractors are eager to see the roll-out of Proton-Geely partnership. Proton’s SUV model based on the Geely Boyue is expected to be a refreshing addition to the line-up.

Mercedes-Benz Going Strong

For the luxury segment, Mercedes-Benz Malaysia Sdn Bhd (MBM) sits at the top. The local unit of the German marquee sold 5,926 passenger vehicles, or 2.3% of the total passenger car market. The three-pointed star brand had a sterling year last year and sold 6,022 cars during the period under review.

With the growing acceptance of its SUV like the GLC, price attractiveness of the hybrid models and new launches, the german carmaker will be a hard act to follow (Pic by Hussein Shaharuddin/TMR)

Despite a slightly lower sales for the same period this year, the German carmaker is confident of hitting another record year for 2017. MBM recently said it is confident to surpass last year’s total sales of 11,779 units.

With the growing acceptance of its SUV like the GLC, price attractiveness of the hybrid models and new launches, the German carmaker will be a hard act to follow for the luxury market segment.

The company recently said it sold 739 compact cars and 1,233 SUVs for the period. The SUV sales accounted almost 22% of the company’s total sales.

Swedish Fascination With Volvo

The Swedish carmaker Volvo had also posted a strong first two quarters figure, selling 430 vehicles. Volvo’s local unit sold 320 units for the same period last year.

Hybrid model Volvo XC90 T8 Twin Engine completely knocked down priced at about RM403,888 is a favourite in its luxury SUV segment. Volvo Car Malaysia Sdn Bhd also introduced the Volvo S90 and V90 in March this year and the Volvo V40 facelift T5 Inscription in June.

The franchise is growing, and luxury car lovers and newcomers are flooding to showrooms as the Swedish carmaker remains true to its tradition of safety, but with a fiery integration of performance, luxury and the latest features of car technology.

BMW Adds To the Rivalry

It is difficult to leave out this German carmaker from the mix. For the January-June 2017 period, BMW sold 4,816 vehicles, or 1.7% of the industry’s TIV. Last year during the same period, BMW sold 3,964 vehicles. Its hybrid is doing the job for the local unit for BMW.

BMW Malaysia Sdn Bhd delivered over 2,300 units of the BMW 330e, BMW X5 xDrive40e and the newly introduced BMW 740Le up to June this year. This makes the plug-in hybrid models accounts for almost 45% of the manufacturers total vehicles sales, the highest in the world.

The BMW X5 xDrive 40e sales have been the driving force. The company already delivered over 3,200 units of the model since it was introduced. The introduction of the new 5-series and expected M models will continue to pit the German automaker with compatriot Mercedes-Benz.

The Luxury Living Strong

One thing is obvious. The luxury car market is experiencing a boom time. BMW and Mercedes- Benz individual sales and market share have surpassed brands like Mazda who sold 4,771 vehicles with a 1.7% market share, Mitsubishi (3,658/1.3%), Ford (3,089/1.1%), Kia (2,305/0.8%) and Volkswagen (2,717/1%).

Based on the numbers, certain brands are facing an uphill tasks to gain lost grounds. But for now, SUVs, luxury models and selected brands are flooring the pedal to another great motoring year.