Automotive market ‘very tough’ now

The uncertain global environment is one of the factors that make the market very tough

By RAHIMI YUNUS / Pic By RAZAK GHAZALI

THE local automotive market is very tough now due to global uncertainties from which the premium segment is not spared.

This is the main reason that customers, particularly in the premium segment, are holding back their purchases, Volvo Car Malaysia Sdn Bhd (VCM) MD Nalin Jain said.

“The uncertain global environment is one of the factors that make the market very tough. On top of that because customers are being very choosy right now. They are waiting,” Jain said at the launch of the new Volvo S60 in Kuala Lumpur yesterday.

Jain said the effect from last year’s tax holiday is also a factor which is affecting the market conditions this year.

Regardless, he is optimistic that the Swedish carmaker could deliver between 30% and 35% growth compared to last year’s figures.

This would match the company’s growth rate a year ago.

VCM sold 1,384 units in 2018, a 35% year-on-year (YoY) growth compared to 1,021 units in 2017.

On exports, Jain said the company is exporting about 50% of its total manufacturing capacity at the Shah Alam plant in Selangor.

The Shah Alam facility produces about 5,000 cars a year and has been exporting to Thailand, Vietnam and Cambodia, among others.

The Swedish car manufacturer is not the only company facing a change of consumer sentiments in the market.

The Malaysian Reserve reported recently that Mercedes-Benz Malaysia Sdn Bhd, the top carmaker in the premium segment, is expecting sales for the year to be lower YoY thus ending its five-year streak of record numbers of cars sold.

Its sales and marketing passenger cars VP Michael Jopp said the reduction in sales volume is due to external factors and partly due to the tax holiday last year.

The new Volvo S60, labelled a “true driver’s car”, is priced at RM295,888 on-the-road and without insurance.

The new midsize premium sedan is powered by a two-litre T8 Twin Engine AWD plug-in hybrid which delivers 407hp and a peak torque of 640Nm, via an eight-speed Geartronic transmission.

The S60, which comes in an R design, accelerates from zero to 100kph in 4.4 seconds.

“Being a true driver’s car, the new S60 is truly one of the most exciting Volvo cars we have ever created. We believe it will put us in a strong position in the Malaysian sedan market and create more growth opportunities for VCM,” Jain said.

The S60 is built on Volvo Car’s Scalable Product Architecture platform, featuring the same safety technology and infotainment system used in the 90 Series cars and the SUV XC60.

A run-off road mitigation with road edge detection, oncoming lane mitigation and city safety with autobrake technology are among the safety features equipped in the vehicle.

The interior is fitted with charcoal fine nappa leather and open grid textile upholstery, as well as Harmon Kardon premium sound system and a panoramic sunroof.

The premium vehicle is also installed with a 360-degree surround view camera and nine-inch head up display.

The car will be imported from the carmaker’s plant in the US, before it is expected to be locally assembled starting the second quarter of next year.