New Market Research Report: Malaysia Autos Report Q4 2013

From: Fast Market Research, Inc.
Published: Tue Oct 15 2013


Over H113, new vehicle sales grew by 4% year-on-year (y-o-y), to reach 313,418 units, according to figures from the Malaysian Automotive Association (MAA). This headline figure was made up of 275,991 passenger cars, up 3.8%, and 37,497 commercial vehicles, up 6%. Although the passenger car segment underperformed the CV segment, BMI is happy to maintain its 2013 passenger car sales growth forecast of 4.1%, to 574,829 units.

In line with our view, vehicle sales slowed down considerably in the past few months after their strong start to the year. One possible reason for this slowdown could have been that consumers waited to see how the ruling coalition, which won the May 2013 elections, would follow through on its promise of lowering car prices. Election uncertainty was a risk we highlighted back in March, which prompted us to downgrade our sales forecast at that stage.

With regards to government policy, it will not be until the release of the National Automotive Policy (NAP) in H213, that we will get greater clarity on the government's strategy for the country's auto sector. Should car sticker prices fall in the coming months, it will be due to discounts provided by carmakers and not any specific government policy.

Full Report Details at
- http://www.fastmr.com/prod/673301_malaysia_autos_report_q4_2013.aspx?afid=303

The commercial vehicle (CV) segment outperformed the passenger car segment for the first half of 2013, as H113 CV sales grew by 6.0%, to 37,497 units. However, we expect base effects of H212 to pose a drag on sales in the latter half of 2013, which has prompted us to downgrade our full-year CV sales growth forecast to 4.0%, to 78,587 units, from 6.0% previously.

On the other hand, we expect the passenger car segment to stage a comeback in H213 and improve on its H113 performance, when sales grew by just 3.8% y-o-y. With aggressive sales campaigns and new model offerings by dealers on the cards, we expect many consumers who have sat on the sidelines recently to jump in and make a purchase. Furthermore, the upcoming festive month sales promotions will further provide a lift to car sales. Therefore, we are happy to maintain our 2013 passenger car sales growth forecast at 4.1%, to 570,000 units.

This will then revise our total vehicle sales forecast to 4.1%, to 653,415 units, from 4.3% previously. One risk to our upbeat view on passenger car sales for H213 comes from the recent tougher lending restrictions imposed on banks by Bank Negara Malaysia (BNM). This could have the effect of further tightening consumer credit (which would affect auto loans) due to a more stringent loan approval process. That said, our conservative car sales growth forecast does provide some margin for such a scenario.

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Company: Fast Market Research, Inc.
Contact Name: Bill Thompson
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