National carmaker Perusahaan Otomobil Kedua Sdn Bhd (Perodua) saw a 2.5% dip in its market share for new vehicles to 28.4% in the firsthalf of 2014 (1H14) due to stronger competition from non-national carmakers.
This is despite total industry volume growth of 6.2% to 332,800 vehicles sold in the same period.
As a result of the drop, Perodua is revising downward its 2014 sale from 197,000 units to 193,000 units due to competition from non-national carmakers which have gained market share at the expense of the national carmakers.
“Our 1H14 performance has not been very encouraging,” Perodua president CEO Datuk Aminar Rashid Salleh told the media in Kuala Lumpur yesterday.
“That being said, we are revising our sales number as competition is more formidable than previously expected,” said Aminar.
According to Aminar, the revised figure has also factored in the rise in overnight policy rate and the introduction of a completely new model in the A segment to complement the three models it currently has in its stable.
Nonetheless, Aminar declined to say when the model would be launched, not even saying whether it would happen in the third or the fourthquarter (4Q) of the year although the plant in Rawang, Selangor, where the new model would be manufactured is scheduled for completion in 3Q of the year.
Aminar remained mum and would not even divulge the price of this new model or whether it would replace its Viva model.
Aminar said the Viva is a hard model to sell due to the high rejection rate by banks but a recent price cut on the model has to increased bookings and loan approval rates from banks.
Apart from lowering the price on the Viva, Perodua has also reduced the price on its Alza model earlier this year.
When asked if profit margin would improve in spite of lower revenue due to lower sales and price cuts, Aminar would only say that its shareholders expect returns.
“Car sales profit margin has been squeezed but after-sales service presents a business segment for us to grow,” said Aminar.
Aminar added that currently only about 30% of Perodua customers have their cars serviced by Perodua after the end of the warranty period and this presents a market to tap and grow. Perodua saw an increase of 4% to 956,000 vehicles visiting its service centres.
As a result, revenue increased by 4% to RM272 million,” said Aminar.
Lastly, Aminar predicted the next six months would continue to be challenging from a sales perspective but he is hoping the company would do better in the area of after sales service.