KUALA LUMPUR, Malaysia, Jan. 9, 2013 /PRNewswire/ -- Frost & Sullivan remains optimistic on the Malaysian automotive sector despite predicting a 2.9 per cent year-on-year decline in 2013 vehicle sales to 600,000 units.
Mr. Kavan Mukhtyar, Partner & Head of the Automotive & Transportation Practice, Asia Pacific at Frost & Sullivan said that the projected marginal decline in total industry volume (TIV) in 2013 was due to the overall uncertainty with regards to the general elections and the likely announcement of the revised National Automotive Policy (NAP).
"The overall uncertainty surrounding the general elections and the NAP are likely to restrain fresh demand as well as the significant replacement market," he added.
He also said that the trimming of subsidies to contain budgetary deficit will lead to a possible increase in fuel prices which will likely lead to an increase in vehicle ownership cost.Mr. Mukhtyar added that automakers are likely to adopt a cautious approach in launching new models until the revised NAP is announced. New vehicle models expected to be launched in 2013 include Honda CR-V, Subaru Forester, Kia Rio, Kia Picanto, Kia Fort K3, Land Rover Range Rover, Honda Brio, Honda Accord and Toyota Corolla Altis. "The continued tightening of hire purchase rules and stricter loan approvals is also likely to have a negative impact on entry level vehicles," Mr. Mukhtyar said. Mr. Mukhtyar said that sales of passenger vehicles will likely fall 4.7 per cent year-on-year in 2013 to 518,000 units as some consumers hold back purchase of big-ticket items due to the uncertainties. He added that commercial vehicles segment is expected to stay on the growth path in 2013, driven by strong performance in the construction, oil and gas industry. The commercial vehicles segment is expected to grow 9.9 per cent year-on-year to 82,000 units in 2013.