Malaysian Market Seen Growing Just 1.2% in 2012

Malaysian new-vehicle sales this year are expected to inch up 1.2% from like-2011 to 612,000 units, industry analyst Frost & Sullivan predicts.

Kavan Mukhtyar, head of the company’s Asia/Pacific automotive and transportation practice, says the forecast is unchanged from the beginning of the year despite stricter lending guidelines enacted by Bank Negara Malaysia.

Mukhtyar says the tighter rules issued by the Malaysian central bank mostly affect entry-level vehicles such as the Perodua Viva and Proton Saga.

The impact is expected to be reduced, he says, as auto makers step up marketing and sales campaigns including higher discounts and adoption of a pre-screening approval process for hire-purchase loans.

The rejection rate for new-vehicle loan applications has declined since May as dealers and banks adjust to the stricter lending guidelines and work together to shorten the process and make it more consumer-friendly.

Mukhtyar says hybrid cars will continue to be in demand, thanks to attractive government incentives.

The D-segment, comprising premium and large sedans, will be the fastest-growing segment this year with deliveries jumping 30% to 36,058 units, driven by catch-up sales of the new Toyota Camry and Honda Accord, new variant launches and high demand for luxury models such as BMW and Mercedes-Benz.

Mukhtyar predicts C-segment midsize sedan deliveries will rise 5% to 234,482 units, making it the largest contributor to Malaysia’s total vehicle sales with a 38.3% share of the market.

C-segment growth will come from new models such as the Proton Preve, Peugeot 408, Honda City FL, Honda Civic FMC and Volkswagen Polo Sedan.

“Increasing demand for hybrid vehicles such as Honda Insight FL and Toyota Prius FL will also help to drive growth in the segment,” Mukhtyar says in a statement.

Sales of SUVs and all-wheel-drive vehicles are projected to climb 11% to 25,699 units, as inventories are replenished following last year’s natural disasters in Japan and Thailand.  The Honda CRV, Kia Sportage and new Mazda CX-5 are expected to be among the top performers.

Mukhtyar says the B-segment’s small and compact cars will see a 0.3% uptick in sales to 98,792 units, driven in part by demand for the new 1.5L Perodua Myvi and introduction of hybrid cars such as the Toyota Prius C and Honda Jazz.

“Most consumers are likely to opt for B-segment vehicles, especially entry-level cars such as the Perodua Myvi, due to the narrow price gap,” he says.

A-segment deliveries are seen falling 12% to 57,376 units, mainly because of the stricter lending guidelines and lack of new models.

In the commercial-vehicle segment, pickup-truck sales are forecast to rise 6% to 46,478 units, led by the market-leading Toyota Hilux and supported by new entrants such as the Chevrolet Colorado and Ford Ranger.

Truck deliveries are expected to fall 5% to 15,000 units, Mukhtyar says, mainly because of a dearth of new models.