Peugeot dealership goes to Berjaya venture

The new distributorship signals a new partnership that will enable PSA to continue its growth strategy in Malaysia

by RAHIMI YUNUS / source: NAZA GROUP

FRENCH carmaker Groupe PSA has awarded Berjaya Auto Alliance Sdn Bhd the sole distributorship of new vehicles under the Peugeot marquee and the rights of after-sales and spare parts distribution for the Peugeot, Citroen and DS marquee vehicles in Malaysia.

Berjaya Auto Alliance is a newly incorporated company with Berjaya Corp Bhd and Bermaz Auto Bhd (BAuto) holding 51% and 20% stakes respectively, according to a joint statement by the two companies and PSA yesterday.

The statement, confirming The Malaysian Reserve’s (TMR) previous report, noted the new distributorship signals a new partnership that will enable PSA to continue to pursue its growth strategy in Malaysia.

“Our product line-up of award-winning SUVs Peugeot 3008 and Peugeot 5008 has garnered a lot of attention here in the past few years, and as such we strive to continue the momentum through exciting new models and after-sales initiatives.

“It is our plan in the future to introduce our global successes such as the all-new Peugeot 2008 in Malaysia,” PSA South-East Asia senior VP Laurence Noel said in the statement yesterday.

She said PSA aims to continuously revolutionise the customer experience with its new partner Berjaya Auto Alliance and is committed to excellent sales and after-sales service.

PSA has made Malaysia its export hub for the region, she added. Noel said PSA is confident the business collaboration with Berjaya and BAuto via Berjaya Auto Alliance, will accelerate growth and create a synergy of key strengths between PSA and the newly incorporated company.

She said the new collaboration will consolidate and increase the group’s market presence here. Berjaya CEO Datuk Seri Robin Tan Yeong Ching said the new collaboration will complement the group’s existing automotive business namely, HRO wen plc and Berjaya China Motor Sdn Bhd.

“We believe this collaboration between Berjaya, BAuto and PSA will bring positive synergistic benefits to all parties,” he said.

BAuto executive chairman Datuk Seri Ben Yeoh said the new collaboration is expected to contribute positively to the company’s future earnings base.

TMR reported any company that takes over the distributor business of Peugeot after Naza Group of Cos is expected to face a huge challenge to make the brand successful in Malaysia.

Besides Peugeot, Naza was also speculated to surrender its Kia distributorships as it was weighing options to leave the automotive business.

Industry experts said Kia and Peugeot — Korean and French marquees respectively — would face the same struggle under a new owner that they endured under Naza, which is product positioning.

An automotive industry leader said the two brands will be competing in a market where national cars are becoming increasingly popular, and thus squeezing the non-national segment’s market share.

Within what’s left of this segment, the Japanese makes are strong for head-on competition.

The source said Kia’s and Peugeot’s marketability would be handicapped by low volume, thus making it difficult for the brands to enter into the completely knocked-down space to get an edge, for example, in terms of pricing from excise duty incentives.

Another industry insider said the two brands may end up cannibalising BAuto’s Mazda portfolio, which offers the same range of products.

Naza used to generate about RM30 million and RM20 million a month from Kia and Peugeot distributorships respectively, according to people with knowledge of the matter.

In a report, CGS-CIMB Securities Sdn Bhd analyst Mohd Shanaz Noor Azam said Peugeot could be indirect competition with Mazda for BAuto given the similar portfolio offerings and pricing strategy, especially in the SUV segment.

Nevertheless, he said Peugeot has a decent portfolio in the hybrid and electric-vehicle segments, which is not available in the Malaysian market but could appeal to BAuto.


Read our earlier report

Naza to leave auto business?