The first month of the year was a short sales month due to the Chinese New Year festive season, partly the reason for the 35% drop in the Total Industry Volume (TIV) of new vehicles delivered. However, it was not an unexpected drop after the exceptional high of December which recorded the highest sales volume in 2022.
February is also a short month, some years made shorter by festive holidays, so it is also not a month when high numbers are expected. Nevertheless, February saw a jump of 27% from the January TIV to close at 62,649 units.
Source: Monthly reports of Malaysian Automotive Association Note: BMW, Mercedes-Benz and MINI data is only provided quarterly so the cumulative volumes shown are only for January to September 2022.
Although it had a slow start to 2022, Proton’s production has now risen substantially and in August, deliveries totalled 15,880 units (including export sales). It was the best sales month for the Malaysian carmaker since July 2013, 109 months ago.
Cumulatively, for the first 8 months of the year, sales of Proton vehicles reached 87,481 units, a 39.7% over the 62,637 achieved between January and August 2021. By Proton’s estimate (based on the expected Total Industry Volume of 66,900 units), that would give it a market share of 19.5%, with the August numbers alone taking the share to an estimated 23.7%.
The company remains focused on ending 2022 with a fourth consecutive year of volume growth.
Sales leadership Despite the recent launch of new direct rivals from other brands, Proton has maintained its position at the top of the SUV segment. The X50 reached a third consecutive month where deliveries crossed the 4,000-unit level with 4,329 units delivered in August. It’s the first time an SUV has achieved such a feat in Malaysia and comes on the back of its industry record with 4,763 units in July.
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The larger X70 contributed 1,555 units in August, bringing Proton’s total SUV sales for the month to 5,884 units. The cumulative volume for 8 months is now at 37,489 units.
On the passenger car side, the Saga also benefited from improved component supply as 6,156 units were delivered last month. Demand for the latest Saga remains high and total deliveries have exceeded 14,000 units since its launch in May this year.
The biggest beneficiaries of the increase in production volume were the Persona and Iriz. 2,612 units of the Persona were delivered nationwide, the highest number since February 2020. For the Iriz, the 962 units delivered were at a sales level not since April 2021.
Stabilised production “With four months to go in 2022, Proton’s production operations have stabilised. Critically, our component supply is now more consistent and better managed to ensure we can produce as many cars as possible. With that in mind, we have undertaken an initiative to increase the number of delivery trucks by over 100% by the end of the year. This makes it easier to ensure our dealers receive their stock as quickly as possible and, in turn, this benefits our customers who have been patiently waiting for their vehicles,” said Roslan Abdullah, Deputy CEO of Proton.
As expected, sales in July 2022 fell and the Total Industry Volume (TIV) dropped 23% to 48,922 units. The reason was partly due to June being exceptionally high as many people rushed to buy their new vehicles before the sales tax exemption ended. Whatever stocks companies had were quickly exhausted during the month and the TIV might have been higher if there had been more supply.
For those who managed to confirm their bookings by the last day of June 2022, the sales tax exemption will still apply for their new vehicle, provided it is registered not later than March 31, 2023. That should be ample time for the assembly plants to supply the vehicles.
Looking back at 2021, the TIV this year is certainly higher. In July last year, due to the MCO and restrictions, sales fell to less than 7,500 units for the month. On a cumulative basis, the TIV has reached 380,595 units after 7 months, 48% higher than the volume for the same period in 2021.
On the production side, from January to July this year, 369,994 vehicles were assembled locally, almost 126,000 units (52%) more than for the same period last year. However, the chip and parts shortages continue to slow down output as vehicles cannot be completed. This affects both locally assembled as well as imported models since the chip shortage is global.
The Malaysian Automotive Association expects August sales to be at the same level as July. The association revised its annual forecast upwards by 30,000 units to 630,000 units. This means that average monthly sales will have to be about 50,000 units in the remaining 5 months.
The situation at the moment is not a true picture of the state of the market as the number of registered vehicles reported to the MAA is largely dependent on whatever stocks are available from the plants or from overseas. Until the supply situation stabilizes, it will be hard to ascertain the demand since every available unit is delivered as soon as it arrives at the showroom.
While 2021 was a difficult year for the car companies, 2022 has seen significant increase in volumes in spite of the ongoing supply shortage of certain parts, limiting output from the plants. According to the Malaysian Automotive Association, which has been compiling industry data since 1967, the Total Industry Volume (TIV) in the first six months of 2022 was 331,386 units, an increase of 82,208 units or 33%.
This big increase is attributed to the pent-up demand for new vehicles but it has also to be noted that the TIV for the same period in 2021 was low due to the restrictions of the Movement Control Order (FMCO) in June 2021. As can be seen in the chart, the strict restrictions saw a sharp drop in sales.
Total Industry Volumes – 2022 vs 2021. All charts provided by Malaysian Automotive Association.
Following the government’s decision of not extending sales tax exemption incentive for passenger vehicles (under the PEMERKASA+ package) after June 30, 2022, bookings surged as those who wanted to beat the deadline rushed to place bookings for new vehicles. Although they would not get their vehicles before the deadline, the government has allowed the exemption to be allowed provided the new vehicles are registered by March 31, 2023.
TIV (Total Industry Volume) of new vehicles by month.
This pushed the June TIV to 63,366 units, an exceptionally high volume as companies rushed whatever stocks they had to customers. The figure could have been higher, had there not bee the shortage of vehicles due to the shortages of chips and components which affected certain makes.
The top 5 brands
The top 5 brands retained their 2021 ranks, with Perodua still leading. While volumes rose, the markets shares of Perodua and Proton decreased, but the market shares of the non-national makes rose.
Higher output from factories
Total production volume in the first half of 2022 also increased likewise by 31.8% to reach a total of 317,933 units compared to 241,288 units in the same period last year. The much higher total production volume seen this year was because there was a total lockdown enforced by the government in June 2021 which shut down factory operations. In addition, the higher output was also in response to the high demand.
Production volumes for first half of 2022 and 2021.
Forecast revised upwards
For the whole of 2022, the MAA has raised its forecast to 630,000 units in view of the strong and positive market trend. This is 30,000 units more than the original forecast announced at the beginning of the year. This means that during the second half of the year, monthly saves will have to be at least 49,760 units.
Revised forecast for 2022. *: Original forecast was announced in January 2022.
In revising its forecast, the MAA has taken various economic and environmental factors into account as well as drawn on input from its members. The association expects the country’s economic recovery to maintain its momentum and the Finance Ministry is maintaining its official GDP forecast of 5.3% to 6.3% for 2022.
However, there are still some factors that can slow the economic growth, such as geopolitical tensions, escalating oil prices, inflationary concerns, and increases in food prices. These may also make consumers hesitate in making purchases, while business in the auto industry may faced increased logistics and shipping costs and experience supply chain disruptions. Bank Negara Malaysia’s recent decision to increase the Overnight Policy Rate (OPR) by 25 basis points to 2.25% may also dampen consumer confidence.
Looking ahead till 2026…. assuming that there are no major disruptions in Malaysia or globally.
Sales figures in other ASEAN markets from January to May 2022. The data for electric vehicles is based on officially reported numbers by members of the respective automotive associations in each country.
Source: Monthly reports of the Malaysian Automotive Association (MAA).
The Total Industry Volume (TIV) of new sales in May was 12% lower than the TIV for April, dropping below 50,000 units. Contributory factors were the reduced number of working days due to the Hari Raya Aidilfitri holidays but of great impact was the shortage of new vehicles to deliver.
Many car companies have a large number of orders but cannot fulfill them as the auto industry continues to be affected by the global microprocessor shortage and logistics delays. As the microprocessors are essential for the many electronic systems in today’s cars. their inavailability means the cars cannot be completed.
Compared to the same month in 2021, the TIV this year was 5% higher and when the cumulative volume for the first 5 months of 2022 is compared to the same period in 2021, the deliveries are higher by 7.4% at 264,656 units.
Although there is the microprocessor shortage and other issues affecting production, the assembly plants around the country were able to produce 16% more vehicles than for the same month in 2021, This year, total output was 49,154 units, made up of 45,518 passenger vehicles (excluding pick-up trucks) and 3,636 commercial vehicles (including pick-up trucks). The latter segment saw a bigger increase of 54% in volume compared to May 2021.
The Malaysian Automotive Association (MAA) expects sales in June to be higher. With no further extension of the sales tax exemption confirmed, many car-buyers will be rushing to place their bookings before the end of the month when the exemption ends. However, the Finance Ministry recognises that the industry has been having difficulties supplying vehicles to meet the backlog of orders and will allow those who book before June 30, 2022 to enjoy the exemption even if they do not get their new vehicle by then. However, they must get it registered by March 31, 2023.
While March saw a big surge in new vehicle sales to take the Total Industry Volume (TIV) past the 70,000-unit level, April’s TIV fell by 23% to 56,213 units of passenger and commercial vehicles.
The decline was attributed by the Malaysian Automotive Association (MAA) to the following reasons – 1) the ongoing global shortage of microchips as well as certain components and logistics delays, and 2) companies with their financial year ending in March put in maximum effort to close with the highest volume.
While the TIV for April 2021 was 4% higher, the cumulative volume after the first 4 months of this year is 8% higher, with 215,965 vehicles sold. This is made up of 140,905 units of passenger vehicles (excluding pick-up trucks) and 25,560 of commercial vehicles (including pick-up trucks).
Local production has, likewise, also been higher in the first 4 months of 2022, compared to the same period in 2021. The combined output from all the assembly plants was 208.894 units, 10,418 units more than in 2021.
The output in April was also higher this year, with 54,734 units produced, compared to 51,390 units in the same month last year.
Although May is a short working month due to the long holidays during the Hari Raya Aidilfitri period, the MAA expects that the TIV can be as high as April’s. Many companies still have a backlog of orders to fulfill and even if the market takes a ‘breather’, the numbers can still be high. Nevertheless, how many units that can actually deliver will depend on how many vehicles can be completed given the shortage of microchips.
Last year, UMW Toyota Motor (UMWT) started the year with the aim of regaining the top position in the non-national segment and it successfully achieved that objective. The momentum has continued into 2022 as the company held the top position in the first quarter of the year. Entering the second quarter, UMWT expects to push further ahead and has started off with deliveries of 6,946 vehicles (of which 78 units were from the Lexus brand).
Cumulative sales after the first 4 months of the year have reached 29,393 units (Toyota + Lexus), an increase of 11% compared to the volume over the same period in 2021.
With a more optimistic mood brought on by the lifting of many restrictions of the pandemic period, as well as the onset of the Hari Raya Aidilfitri festivities, many people were inclined to consider a new vehicle. In conjunction with the festive period, UMWT had its ‘Bersama Lebih Makna’ Raya promotion which offers benefits worth RM4,000 to those buying a new Vios or Yaris.
Both models, assembled locally as the fairly new second assembly plant in Selangor, have seen growing popularity as they are good value for money. The image of the Vios has also become sportier with the intensive promotion of the Vios Challenge one-make series over the past few years. Each round has been broadcast live, bringing the races right to homes around Malaysia and even outside the country.
Vios Challenge one-make series, in its fifth season this year, has added a sporty image to the popular sedan.
“It is heartening to note that we have transitioned well into the endemic phase, and we at UMW Toyota Motor are always encouraged by the support from our customers, especially during this busy Ramadan and Raya period. Even with the surprise announcement of Aidilfitri falling a day earlier than expected, all our service centres were fully prepared to assist our customers in their ‘balik kampung’ journey. We continue to be committed to leaving no one behind and offer value-for-money innovations, coupled with advanced technology and security features in all of our products,” said Ravindran K, President of UMW Toyota Motor.
‘Bersama Lebih Makna’ Raya
With Ramadan and Syawal being the prominent events of this month, UMWT presented a special film entitled ‘Kota Raya’ on various several social media platforms. Inspired by family ties and the importance of being together, the film focuses on the deep-rooted tradition of celebrating together, something which was greatly missed over the past two years due to travel restrictions.
Besides the film, UMWT also reached out to those less fortunate in a collaboration with Harian Metro through their ‘Titipan Kasih’ programme. With the aim of providing assistance to the underprivileged, this outreach by the company saw 50 children receive ‘baju raya’ worth RM150. Additionally, a ‘Kotak Rezeki’ consisting of groceries valued at RM100 was presented to 168 families. 50 children also received RM60 each as ‘duit raya’.
Volunteers from UMWT also carried out other outreach activities to assist the less fortunate during this recovery period and at the same time, establishing a relationship with the surrounding community.
“The focus of this activity was for us to share the festive celebration with the less fortunate, as it is more meaningful if we celebrate it together. Furthering our ‘Bersama Lebih Bermakna’ Raya, we wanted to reach out to all those underprivileged, especially the orphans, and single-parent families. We also wanted to inspire and instill a strong spirit of volunteerism, along with community service among our employees as a way to bring our brand closer to the community,” Mr. Ravindran said.
Toyota showrooms nationwide will also have ‘Toyota Raya Open House Weekender’ events on May 21/22. This event aims to reconnect with Toyota customers, both past, present and future, while celebrating Hari Raya together. At the events, there will also be special deals and promotions and those who take test-drives will receive gifts (while stocks last) in appreciation of their interest.
Visit www.toyota.com.my to know more about Toyota products and services and the locations of showrooms.
Data source: Monthly sales reports compiled by Malaysian Automotive Association.
With output from the plants increasing, deliveries in March rose by 62.5% from February to pass the 70,000-unit mark which is one of the highest (if not the highest) in the industry’s history.
Apart from having more stocks, some of the companies with financial years ending on March 31 also put in their final effort to close with the highest possible numbers. Additionally, March also had many business days to sell cars although for many customers, there would still be a lengthy wait, especially for the more popular models.
With the Finance Minister having indicated that the exemption for sales tax won’t be extended again, there is also a rush by customers to get their new vehicles and save money. Again, due to the large number of orders and backlog, some companies are already warning customers that they might not be able to enjoy that saving as their vehicle might not be available before the end of June when the exemption period ends.
Compared to the same month the year before, the Total Industry Volume (TIV) for March 2022 was also notably higher by 13%.
The global shortage of microchips continues to affect carmakers locally as well as in other countries. Members of the Malaysian Automotive Association (MAA) expect that output will still be disrupted and imported vehicles may not be coming in large numbers.
This is likely to cause April’s TIV to fall in spite of festive promotions for the coming Hari Raya Aidilfitri. The big push in March may also diminish orders although many companies still have a backlog of orders to fulfill.
