At the official opening of the Perodua Global Manufacturing factory this morning, P2 chairman Tan Sri Asmat Kamaludin said that the combined share of national brands Proton and Perodua is now below 50% of the Malaysian market, and this is not healthy for the local automotive industry.
“While we understand the government’s intention to liberalise the automotive industry in the near term, we believe that the country’s automotive eco-system, consisting of local vendors and dealers, as well as original equipment manufacturers like Perodua, has yet to reach a point where we can fairly compete with other established global brands,” he said.
“This is because we have yet to reach the level of maturity, in terms of economies of scale, cost competitiveness and even quality, which other established global brands. If the percentage continues to slide to below 45% then many of the local dealers and vendors may have to cease operations and this will have a negative impact on the economy as a whole,” added Asmat, who is also the group chairman of Perodua stakeholder UMW Holdings.
In a press conference later in the day, with minister of domestic trade co-operatives and consumerism Datuk Seri Hamzah Zainuddin present, Asmat elaborated on the topic.
“We expect national brands to be above 50%. Proton and Perodua have a higher degree of localisation. Perodua buys RM5 billion of parts locally – bigger volume means bigger opportunities for local vendors. So it’s important for us to have a bigger market share,” he said, adding that one must be strong in its home market before thinking of exports, citing Hyundai-Kia‘s domination of the South Korean market.
Perodua president and CEO Datuk Aminar Rashid Salleh said that his company’s estimated 2015 market share based on a total industry volume of 667,000 units is around 32%, which is higher 2014’s 29.4%. The figures are not final as the Malaysian Automotive Association (MAA) is yet to reveal official numbers. An update will be given later this month.
“Our journey will continue. We need to do more, we need to accelerate. We’re already competing with other brands, not just national brands,” he said.
The market share decline of national makes is no sudden phenomenon, and is largely due to Proton’s decline as Perodua has been relatively consistent in holding around 30% share, and pole position. Proton controlled over half of the domestic market back in 2001, but now commands less than one third of what it used to enjoy. Put together, the local players’ share of the market has seen a steady drop over the years, but the point where they surrendered the lead to the non-national makes happened in 2014.
Local or foreign, the strong will survive in the era of liberalisation. Perodua – with a transformation programme in place to be globally competitive in quality, cost and delivery – looks well equipped to sail in the real ocean.
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AI-generated Summary ✨
Comments express mixed sentiments on Malaysia’s automotive industry, focusing on declining market share of national brands like Proton and Perodua. Many critics blame protectionism, cronyism, and lack of innovation for poor quality, high prices, and losing global competitiveness. Several feel Proton and Perodua rely too heavily on government protection and have failed to develop competitive, modern products. There’s frustration over high car prices, safety features, and lack of progress, with some suggesting that eliminating protection and encouraging foreign competition would benefit consumers. Others highlight the economic impact, including lost investments, jobs, and growth opportunities. Overall, the tone ranges from criticism and sarcasm to calls for industry reform, with a consensus that increased competition and focus on quality could improve the country’s automotive future.