Higher TIV in May

According to the Malaysian Automotive Association (MAA), the Total Industry Volume (TIV) of vehicles increased by 18.4% MoM to 68.7k units in May-24. This rise can be attributed to longer working days following the Hari Raya festivities. Compared to the same period last year, TIV saw an 8.7% YoY increase, primarily driven by a surge in passenger car sales, which rose by 11.4% (refer to Figure 1). YTD, TIV has reached 328.9k units, marking an 8.3% increase from the previous year. This growth was mainly driven by strong performance in the passenger car segment, which grew 11.0% to 301.1k units. Meanwhile, the commercial vehicle segment declined to 27.8k units, down by 14.7% YoY.

YTD National Car Marques Grew 12.6% YoY

YTD, Perodua achieved a substantial sales growth of 19.6%, reaching 146.1k units, while Proton experienced a slight decline in sales volume, down 1.3% YoY to 61.4k units. The combined market share of national car brands saw a slight increase, rising from 68.0% to 68.9%.

All Major Non-National Car Registered Higher Sales Volume

All major non-national car brands showed increased sales compared to the previous month. Honda led the pack with the highest growth of 34.3% MoM, reaching 6.4k units, followed by Volkswagen (+23.8%), Mazda (+6.7%), Toyota (+6.6%), and Nissan (+2.3%). YTD, the TIV of non-national car brands saw an 8.0% YoY increase, totalling 93.6k units. Honda notably stood out with sales reaching 32.7k units, reflecting a 13.9% YoY growth while Toyota experienced a modest increase of 0.7% YoY, reaching 27.8k units. Other non-national brands witnessed varying degrees of sales declines, ranging from 7.2% to 51.7% (refer to Figure 2).

Proton and Perodua EV Coming in 2025

Proton and Perodua have plans to introduce affordable EVs by 2025. Proton has recently unveiled its EV brand, namely e.MAS, for its upcoming EV models. Perodua, on the other hand, has taken the wraps off the Electric Motion Online (EMO-1), its first EV. The EMO-1 is reportedly a vehicle about the size of a Myvi, equipped with a 50kWh battery providing a range of 350 km on a single charge. We do not discount the possibility that some customers may postpone their purchases, anticipating the launch of these national brand EVs in 2025 and the expiration of the RM100,000 price cap on imported CBU EVs. It has been reported that the government plans to lift this requirement after 2025. Concurrently, targeted fuel subsidies are expected to stimulate demand for EVs, particularly affordable models, and encourage greater adoption of hybrid and EVs across Malaysia.

Maintain Neutral

We maintain our NEUTRAL recommendation for the sector. Despite the introduction of new models, facelift versions, and new variants, forthcoming car sales might be influenced by declining consumer sentiment amid the implementation of the targeted fuel subsidy scheme. Our 2024 TIV forecast remains at 700k units (-12.5% YoY). Maintain SELL on MBMR (TP: RM4.70) while Buy BAuto (TP: RM2.66) and SIME (TP: RM3.27).

Source: TA Research - 25 Jun 2024