Proton has started off 2023 with a strong surge in sales, having its best start to a year since 2013. With 11,681 units (including export sales) delivered in January, the increase in sales compared to the same month a year ago was 162.3%. With the market size for January estimated to be 51,000 units, Proton’s share would be 22.9%, an improvement of more than 12% compared to January 2022.
The strong performance is due to greater supply of vehicles from the two factories in contrast to the reduced output that the carmaker experienced last year due to flood-related supply issues. At the end of 2021 and early 2022, there was very severe flooding in some areas of Selangor which affected the operations of some of Proton’s suppliers.
In spite of the challenges of getting parts, especially microprocessors, to complete vehicles, the auto industry in Malaysia actually had a boom year and is expected to have a Total Industry Volume (TIV) of over 700,000 units. Even by November, the TIV had reached 642,306 units, exceeding the sales forecast of 630,000 units made by the Malaysian Automotive Association (MAA).
For Proton, it was also another great year – the fourth, in fact – as the brand saw overall sales of 141,432 units (including exports) in 2022. This was with the addition of another 14,750 units in December, the fourth best monthly performance for the year.
Compared to numbers reported in 2021, Proton’s total sales grew by 23.3% despite a tough start to the year. Production was disrupted at both factories due to a combination of flooding which affected parts vendors in Selangor and an acute shortage of microprocessors, which was a global problem. The situation limited output and deliveries for the first 4 months of the year.
Two months remain for this year and Proton’s total sales volume for 2022 has passed the full year’s sales volume of 2021. Announcing its October numbers today, the Malaysian carmaker said after 10 months of sales, its cumulative volume has reached 115,362 units. In the same period in 2021, it was only 114,708 units, or a difference of 33.6%.
The 10-month sales volume, which was contributed by the addition of 13,013 units (including exported vehicles) in October, was also noteworthy as it was the company’s highest volume since 2014.
Following the signing of the agreement to appoint the Combined Motor Holdings (CMH) Group as the distributor for Proton vehicles in South Africa in April this year, the Malaysian brand has returned to the continent’s largest passenger vehicle market. Besides Proton, CMH also represents brands such as Ford, Chery, Honda, Toyota, Suzuki, Mahindra, Peugeot and Citroen.
CMH recently held an official relaunch of the brand which included introducing the X70 and X50 SUVs. Manufactured at Proton’s Tg, Malim plant in Perak, the first batch of vehicles was shipped by sea to the port of Durban. Later in the year or in early 2023, CMH will also introduce the Saga.
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.
Having enough vehicles to deliver has been an ongoing problem for some time, due to the difficulty in completing vehicles as critical parts like microprocessors are in short supply globally. There is some progress in increasing output and at Proton, the effort has paid off with the carmaker able to deliver a record number of its X50 SUV in July.
And not only was it a new monthly sales volume record for the model but from their market intelligence, Proton also found that the 4,763 units of X50 delivered nationwide was the highest number for any model in the market. It’s been a long time since Proton could enjoy such an achievement and reflects the increasing output of vehicles from its factory in Tg. Malim, Perak.
Proton factory in Tg. Malim, Perak.
The record number of units also strengthens Proton’s position as the leader in the hotly contested SUV segment and is also the first time such a vehicle has led the overall market in volume.
The X50 accounted for 41.5% of the total Proton registrations for the month – 11,477 units (domestic + export). The cumulative volume for 7 months has reached 71,601 units, an increase of 19.7% over the same period in 2021.
Proton had a 22.7% market share in July, based on its estimation of the Total Industry Volume for the month being 50,500 units. Its cumulative volume from January to July would likely see its market share going up to 18.7%.
Proton X70
Besides the impressive performance of the X50 in July, the X70 also sees continued strong sales. With the updated model launched in early June, interest has grown and 1,704 units were registered in July. This allowed it to retain sales leadership for C-segment SUVs, contributing to Proton’s cumulative SUV volume in 2022 going past 31,500 units.
Strong performances by other models The rejuvenated Proton also continues to record strong numbers, with 4,521 units registered in July and bringing total volume for the year to 28,005 units. The figures also indicate the 2022 model, launched on May 12, achieved 9,811 registrations in just 80 days.
The Exora MPV also retained its long-standing leadership position with 476 units registered. However, due to approval delays in July, the Persona and Iriz numbers were not their usual high as registrations had to be temporarily suspended.
“Following a hectic June where automotive industry players scrambled to lock in bookings before the end of sales tax incentives, July was a month of consolidation where market demand fell to normal levels, and everybody concentrated on fulfilling orders already received. Proton was no exception and with our parts supply situation continuing to improve, we were finally able to show the true sales potential of the Proton X50,” said Roslan Abdullah, Deputy CEO of Proton.
“The company is immensely proud of the model becoming the first SUV to be crowned as the best-selling vehicle in Malaysia and we are thankful for the support from our customers. This achievement and Proton’s sales leadership in other segments shows our business plan is on the right track and repays the confidence placed in the brand by buyers, investors and other stakeholders,” he said.
“The easing of restrictions in global trade has been a major boost for Proton’s export division. With 5 months to go, we are on target for yet another year of double-digit percentage growth, though our enthusiasm is couched by economic issues faced in overseas markets,” said Encik Roslan Abdullah.
Proton Commerce Sdn Bhd Proton’s financing subsidiary, Proton Commerce Sdn Bhd, has announced it will honour all Letters of Understanding (LOU) at the stated interest rate even if they were issued prior to recent interest rate hikes. Terms and conditions apply, and funds must be disbursed by December 31, 2022, but it ensures customers who already have an LOU from Proton Commerce and are awaiting their orders do not have worry about being charged a higher rate for financing.
“We are working to ensure that despite recent interest rate hikes, our customers will still be able to afford the vehicles they ordered. It’s vital to ensure we convert as many bookings as possible into transacted sales as this will help drive registrations as we continue to strive for more future success,” said Encik Roslan Abdullah.
With steady progress towards resolving issues delaying production of new vehicles, Proton recorded its best sales month of 2022 with 14,787 units (domestic + export) registered in June. This volume represented a 51.0% growth over the previous month, taking total sales for the first half the year past 60,000 units. The 60,124 units delivered were an increase of 3.9% over the same period in 2021.
Overall, Proton retains its second position in new vehicle sales in Malaysia and estimates its market share to be 22.6%. The cumulative market share for the year is 18.2%, a decrease of 5.1% compared to the first 6 months of last year. This is based on an expected Total Industry Volume (TIV) of 331,164 units (the Malaysian Automotive Association will announce confirmed data later in the month).
Proton X50 achieves best sales month
Launched in October 2020, the X50 SUV has been remained a strong seller for Proton. It has helped catapult the brand to the position of best-selling SUV brand in the country. June saw the X50 recording its best sales month with 4,473 units delivered nationwide. This volume was clearly ahead of other B-segment SUVs as well as in the overall SUV market.
The X50’s bigger brother, the X70, also saw strong sales, especially with the updated model. It achieved its best performance in 20 months with 2,696 units. This volume, according to Proton, puts it at the top of the C-segment SUV list.
Another model enjoying the benefits of a recent refresh is the Saga, with the 2022 model introduced on May 12. In June, 5,460 units were delivered, which Proton says puts it back to the top of the A-segment sedan class. During the first 6 months of 2022, the model’s cumulative total has reached 23,484 units.
The evergreen Exora MPV has kept its leadership in the C-segment MPV class and in June, the company delivered 513 units. As for the Persona and Iriz, these two trusty models recorded deliveries of 1,224 units and 421 units, respectively.
Over 150,000 bookings in 6 months
“June was a busy month for the automotive industry with most brands trying to produce as many cars as possible to satisfy market demand. The announcement that sales tax exemption would be removed from July 1 also created a surge in bookings as customers rushed to take advantage of the savings offered. Proton has received more than 150,000 bookings for the first 6 months of the year and when added to carry-over orders from 2021, we will need to work hard to deliver cars as quickly as possible to eager customers,” said Roslan Abdullah, Deputy CEO of Proton.
“Thankfully, the gradual resolution to our parts shortage issues has not only boosted production but also had a positive effect on the aftersales network. As promised, all our 3S/4S outlets now have 3 months stock of fast-moving parts and this is replicated at our parts warehouse. Supply issues for other parts are also being resolved so we are hopeful of delivering a higher level of aftersales service to our customers soon,” he added.
Top exporter
Proton was the first company to export vehicles from Malaysia and today, it is also the top vehicle exporter. While its domestic sales continue to grow, the growth in export sales has also been significant. For the first half of 2022, the total number of vehicles exported was 2,722 units, an increase of 81.2% over the previous year.
The Saga has accounted for 59% of the total volume exported but the X70 and X50 are also growing in demand at a faster pace. As in the domestic market, June also saw both model posting their best-ever export numbers and Proton expects even better numbers in coming months.
Pakistan continues to be the biggest export market, taking 1,770 units for the first half of 2022, a growth of 183% compared to the first half of 2021. This was followed by Brunei and Bangladesh with 203 and 194 units, respectively. Local assembly in some countries is helping Proton’s distributors to price the models competitively in their markets.
“Proton’s exports are one of the pillars to drive our future growth and also in line with our promise to the government to help develop Malaysia’s automotive export industry. With the addition of new markets such as South Africa to our portfolio, we target for export volumes to continue on their current growth trajectory and form an even larger portion of our sales in the future,” Encik Roslan Abdullah said.
Up till 2001, Proton had entered many markets around the world, with over 210,000 cars exported to 51 countries. However, after that, the number fell and although recognizing that exports were vital as its protection in the home market diminished and competition increased, Proton did not have a strong export business.
The number of exported vehicles dwindled to only 248 units in 2017 but over the past few years, the Malaysian carmaker has been slowly rebuilding its presence overseas and even having models assembled in some countries. Volumes are seeing a gradual upturn and last year, 3,018 Proton vehicles were exported, more than double the number in 2020. For 2022, the International Sales Department is targeting to grow export sales exponentially to 10,000 units.
As it has a bigger focus on righthand-drive models, it has obviously given more attention to countries where motorists drive on the left side, like us. The latest new market is South Africa, although it is not unfamiliar to Proton as the brand had a presence there up till 2012. It will return with the X50 and X70 this September, followed by the latest Saga.
It will be represented by the CMH (Combined Motor Holdings) Group, an investment holding company which has been active in the motor business since 1987. Proton joins a long list of global brands that CMH represents, some of which are Ford, Chery, Honda, Toyota, Suzuki, Mahindra, Peugeot and Citroen.
SUVs to grow export sales
Proton’s growth will be achieved not only by entering more new markets but also increasing local assembly (CKD) operations overseas. Currently, the carmaker has CKD operations in Pakistan, Kenya and Bangladesh with Sri Lanka set to begin in the second half of 2022. The company currently exports cars to 13 overseas markets, with South Africa becoming the fourteenth one.
As a percentage of Malaysia’s overall vehicle exports, Proton’s numbers are becoming increasingly prominent. From 12.8% of total exports in 2019, the number grew to 30.2% in 2020 and hit 60.9% in 2021. That put the brand at the No.1 position, an achievement in spite of the global pandemic.
Proton SUVs help brand image
Proton’s improved model range has helped in export sales, especially as it has the two SUVs jointly developed with Geely. The SUV segment is the most active globally and the sales success enjoyed in Malaysia by the X50 and X70 has been largely replicated in other markets. This helps to establish the brand, paving the way for more models to be exported.
“Our new model range offers advanced features that are on par with many competitors from other brands. In many of our markets, the Proton X50 and Proton X70 sit near the top of their class in terms of specifications yet are sold at prices equivalent to or less than their direct rivals. This helps to draw in the upper echelon of local car-buyers and helps build brand equity in these markets, making it easier for our other products to then be accepted in the future,” said Steven Xu, Director of International Sales.
“PROTON’s long-term goals require exports to play a major role to grow the company’s overall sales as the annual Total Industry Volume in Malaysia is expected to remain flat. So, we are exploiting the strength of our new products, our brand and even the links Malaysia has with other countries to establish a foothold in many new markets. This is then bolstered by establishing CKD operations where possible, which also helps to grow local economies,” he added.
The year started on a low note for the Malaysian car companies as supply issues and the after-effects of the severe floods pushed new vehicle sales down. However, February – normally a low month due to the short working days – proved to be better in spite of the Chinese New Year holidays.
Proton was among the companies that saw sales rebounding, with a 107% increase in sales. The company sold 9,225 units (domestic + export) during the month, which would put it back in second position on the sales chart for 2022. The company estimates that it captured 20.2% in February although for the first two months of the year, the cumulative market share is estimated to be 15.9%.
Top-seller was the X50
The model with the largest sales volume was the X50 with 3,002 units delivered, bringing the total over the first two months of 2022 to 5,603 units. This SUV has been exceptionally popular and Proton reports that over 100,000 bookings have been received in 16 months.
Next was the evergreen Saga, with 2,951 units delivered; while this is less than its usual monthly average, the numbers are expected to return to their previous level in the coming months. The Persona, with 1,675 units delivered, was third on Proton’s chart. The Exora, though having been in the market for quite some time, remains the best buy for anyone wanting a C-segment MPV.
While domestic sales still trail last year’s volumes, export sales are trending upwards and have grown by 72.8% in 2022. For the first two months of the year, 323 units have exported, compared to just 187 units in 2021.
All production lines in operation
With all production lines in operation at the factories in Shah Alam, Selangor and Tanjung Malim, Perak, February’s rebound in sales was a direct result of being able to produce more cars. “This was only made possible by the outstanding joint efforts of our vendors and Proton staff, who worked and continue to work ceaselessly to get us back on track. Thankfully, our order bank remains healthy, and we remain hopeful of catching up to our targets for this year,” said Roslan Abdullah, CEO of Proton Edar.
“As for the Malaysian automotive industry, the first two months of the year has seen strong demand as evidenced by the growth in TIV compared to 2021. This is good news for both car companies and the vendor community and is also testament to the effectiveness of policies set by the government,” he added.
To better serve its customers and enhance sales growth, Proton continues to grow its sales and service network. The 147th 3S/4S outlet was officially opened in Alor Setar today and is the tenth outlet for EON, a leading dealership. It is also the fifth Proton Platinum Showroom in the country.
A new Proton Platinum outlet operated by EON in Alor Setar.
Addressing customer complaints
“Proton is aware of the issues it faces regarding after sales and parts availability. Our customers have reached out to us, and we deeply regret any inconvenience caused. I would like to reassure them we take every complaint seriously and senior management has identified several bottlenecks and operational issues that require fixing,” Encik Roslan said.
He said that the first step taken to address the availability of parts has been implementation of a mandatory requirement where all dealers are required to have 3 months holding stock of 22 fast-moving parts. “Our central parts centre is also subject to the same requirement, and we hope this will ease waiting times for customers. We are also strengthening the capability and knowledge of our dealers to provide excellent aftersales service to all Proton customers. There is still a lot left to do, but we will give updates on our progress throughout the year,” he added.
Although it is estimated that the Total Industry Volume (TIV) of new vehicles sold in Malaysia last year dropped by at least 4.6% to just over 505,000 units of passenger cars and commercial vehicles, Proton’s sales for the year rose by 4.5% over its 2020 volume. With December contributing 14,147 units, the Malaysia carmaker ended the year with a total of 114,708 units delivered (including export sales). It was the highest closing figure since 2014 and is the third consecutive year of volume growth for the company.
The brand’s market share in December is estimated to be 20.6% but for the whole of 2021, it would likely be 22.7% (pending official data from the Malaysian Automotive Association). This would be an increase of 2% over the market share in 2020, putting it is a firm second position in overall sales.
SUVs make big contribution
It’s not surprising that the two SUV models – the X70 launched in December 2018 and the X50 in October 2020 – have made major contributions to Proton’ sales numbers. This mirrors the global trend that has been going on many years now where SUVs are very popular.
With a total of 45,149 SUVs sold in 2021, Proton can claim to be the best-selling SUV brand in Malaysia. That number accounted for nearly 40% of its total sales volume. Individually, the X50 ended the year with 28,774 units, with December being its best month when 4,310 units were delivered nationwide. It was the second consecutive month the model exceeded more than 4,000 units.
Meanwhile, 16,375 units of the bigger X70 were delivered in 2021 with a final month figure of 1,616 units. This put it at the top of the SUV C-segment, and third in terms of overall SUV sales.
Saga still the bestseller
Nevertheless, the bestselling model for Proton was still the evergreen Saga, with 42,627 units sold. The model is also sold overseas and assembled in some countries as well, enabling better supply of cars to those markets.
Other models that performed well in 2021 were the Exora (4,035 units), Persona (16,153 units) and Iriz (6,708 units). Deliveries rose a bit during December as chip supply issue improved slightly.
Growing international sales International sales were also a major highlight for the company. With 3,018 units exported in 2021, the total volume grew by over 100%. This made Proton the number one local automotive brand for export sales last year. With local assembly operations ramping up in overseas markets coupled to a hopeful loosening of trade restrictions, there is optimism the upward trend will continue in coming years.
“2021 was tough for the automotive industry as a whole and this is reflected in the reduction in TIV compared to the previous year. From a global chip shortage to a spike in COVID-19 numbers that led to another lockdown to skyrocketing transport costs, there were many challenges for industry players to overcome. That is why PROTON’S sales growth in a year where the market contracted was significant as it was the result of careful planning and juggling of available resources,” said Roslan Abdullah, CEO of Proton Edar.
“Regarding export sales, we are equally proud about being the brand with the highest export volume in 2021 as it proves we are gaining traction overseas thanks to the joint efforts of our International Sales division and our foreign partners. While increasing shipping costs are a growing concern, our planned activities in 2022 means we expect export sales growth to accelerate in the coming years,” he added.
7 new outlets opened
The Proton network of 3S/4S outlets started 2021 with 140 outlets and despite the challenges faced in terms of financing and construction works, another 7 outlets were in operation by the end of 2021.
“The growth of Proton’s ancillary businesses such as Proton Commerce and the increase in the number of outlets is directly linked to the number of vehicles we sell. As sales have grown so have our facilities to cater to an increased number of customers. I would also like to announce we have extended the warranty for the 6-speed automatic gearbox used by the CBU Proton X70 to 5 years with unlimited mileage. This is to further benefit our customers and give them added peace of mind,” added Encik Roslan.
