KUALA LUMPUR (Oct 19): TA Securities said car sales could fall to 650,000 units in 2024, compared with the 725,000 forecast by the Malaysian Automotive Association (MAA), as the research house expects stronger competition next year.
Its estimates are despite the positive demand for Proton Holdings Bhd and Perusahaan Kedua Otomobil Sdn Bhd (Perodua) cars, as well as non-national marques, shown in the MAA's report on September total industry volume (TIV), which hit 68,156 units — down 72,809 from the preceding month, but 11% higher year-on-year (y-o-y).
“We expect stiff competition and competitive pricing and carmakers may need to offer discounts to attract budget-conscious customers,” the research house said.
In its note on Thursday, it also reiterated its neutral stance on the automotive industry and anticipated a weaker estimated car sales in 2024 at 650,000 units.
TA Securities kept its "buy" ratings on Sime Darby Bhd with a target price (TP) of RM2.50, and on MBM Resources Bhd with a TP of RM4.11.
However, due to the recent surge in its share price, the research house has downgraded Bermaz Auto Bhd to a "sell", with a TP of RM2.48.
Meanwhile, it also advised shareholders to accept the general offer price of RM5 per share for UMW Holdings Bhd proposed by Sime Darby.
Back in August, Sime Darby had entered into a conditional share purchase agreement with Permodalan Nasional Bhd (PNB) to acquire PNB's 61.2% stake in UMW Holdings. After the deal becomes unconditional, Sime Darby will make a general offer for the remaining 38.8% it does not own, with the aim of delisting UMW Holdings from the stock market.
Earlier, the MAA has announced that the monthly TIV decreased by 6.4% month-on-month (m-o-m) to 68,156 units in September, with the decline attributed to consumers waiting for the tabling of Budget 2024 for more incentives, the note said.
There was a 4.6% y-o-y increase in sales, with TIV in the first nine months of 2023 (9M2023) at 571,767 units.
Both national car brands, Perodua and Proton, saw a decrease in their TIV, in which Perodua’s sales volume fell by 6.8% m-o-m to around 29,000 units, while Proton’s sales volume dropped by 12.3% m-o-m to around 12,000 units.
However, year-to-date, both brands have seen an increase in sales, with Perodua registering an 18.8% growth leading to sales of 233,200 units and Proton recording a 17.1% rise to 114,800 units. The combined market share of national cars has also increased to 67.9% for 9M2023, up from 64.5% in the previous year.
On the other hand, all major non-national car brands in Malaysia saw a decrease in TIV as Mazda experienced the largest drop of 26.2% m-o-m to around 1,400 units, followed by Volkswagen at 24.8%, Honda at 16.3%, Toyota at 9.6%, and Nissan at 1.1%.
Despite this, the combined sales of non-national cars increased by 1.6% on a y-o-y basis to 164,800 units, as the TIV registered by Toyota (increased 10.8% y-o-y) and Mazda (increased 34.9% y-o-y) offset the lower sales volume from other brands (which dropped in the range of 10.2% to 35.6%).
For the first time, the MAA has also released the statistics on hybrid vehicles (HVs) and electric vehicles (EVs). For 9M2023, approximately 19,000 units of HVs were registered, compared to 20,000 units for the full year of 2022.
As for EVs, 5,300 units were sold in 9M2023, a significant increase from the total of 2,600 units sold in 2022.