The X50 in the B-segment

The local assembled SUV will be priced between RM80,000 and RM100,000 for the various variants

Bhupinder Singh

pic credit: PROTON

PROTON Holdings Bhd has launched its X50 SUV and this model will likely be a far more aggressive attempt by the carmaker to take market share of rivals than the X70 SUV was.

You can book one for RM500 at a Proton dealership, but the price of the 1.5-litre turbocharged SUV has not been fixed yet.

Market speculation is that the local assembled SUV will be priced between RM80,000 and RM100,000 for the various variants. At that entry price level, Proton is pretty much seeking to offer an SUV for the same price range some 100,000 B-segment sedans were sold in 2019.

The price would suggest Proton’s strategy for the X50 will be one of going for volumes to make up for lower margins. With the growing popularity of SUVs in the auto market, the X50 will also be value for money for potential buyers seeking to trade down during this uncertain economic period.

It’s already attracting a lot of attention as the hype around its launch on social media posting would suggest.

The B-segment market the X50 may seek to make inroads is now the mainstay of sedans like Toyota, Honda and Nissan.

The sales tax exemptions till the end of the year for passenger cars in the stimulus budget is now driving up sales for all but come next year if the economic situation remains subdued and unemployment remains high, buyer behaviour will change accordingly.

The X50 could be a problem for Proton’s part-owner, DRB-Hicom Bhd, as the X50 may cannibalise sales of its other makes like Honda and Volkswagen.

Investors don’t seem to care much about the potential ramifications now and have been buying steadily into DRB-Hicom’s shares that have risen to RM2.09 at close yesterday.

The price action of DRB-Hicom shares suggests many are pricing in an improved performance from Proton to its bottom line.

Many probably feel the X70 SUV has provided Zhejiang Geely Holding Group Co Ltd’s management with a better understanding of the Malaysian automotive market and time to rebuild its network of sales and service centres, as well as market acceptance of its technical capability and brand name.

The 2-litre SUV did a good job of taking some 26% share of the C-segment SUV market in the country within 20 months of its launch.

Proton sedans like the Saga have also been given a new life and sales have picked up over the years. Now, the competition is being pumped up with the X50. Competitors should be worried.

Bhupinder Singh is the corporate desk editor of The Malaysian Reserve.