KUALA LUMPUR: Perusahaan Otomobil Kedua Sdn Bhd (Perodua) aims to increase its exports to at least 10% or 20,000 units in line with its five-year roadmap besides developing further the vendor community so that they too boost their exports of auto parts.
Although we are relatively strong in the domestic market, at some point in time, the domestic car market will not grow as much, nearing saturation. By that time, we need to be globally competitive to survive, and this is why we need to seriously look into exports, managing director Datuk Aminar Rashid Salleh said in an interview recently. Currently, the national carmaker is exporting only 2% to 3% of its total output.
Things were not as rosy as they seemed for the local car market, Aminar said, adding that it could be approaching its saturation point based on demand and the population. This year alone, MAA (Malaysian Automotive Association) forecast the total industry volume (TIV) to hit 570,000 units, which will be the highest ever in the automotive history of the country, he said.
Comparing Malaysia with Taiwan based on the similarities in population, he said Taiwan reached its saturation point somewhere at a TIV of 800,000 units. We will be reaching the 600,000th mark next year and in the next five to seven years, the local car market may hit a saturation point, dampening any growth potential.
This is the reason we want to contribute and develop the local vendor community so that they can become globally paced as well, he said. Currently, the carmaker is supported by 141 vendors, with local vendors comprising 60%-70% while the rest are joint-venture companies with foreign partners or independent foreign companies.
This is something we are doing to give back to the community; by generating the socio-economic development needed, creating jobs, and purchasing local parts. We purchase these locally made parts to the tune of RM3bil to RM4bil a year, said Aminar.
However, he said vendors faced a high turnover of workers. There must be more concerted effort from the industry, manufacturers and the Government to tackle this problem; to reduce the dependency on foreign workers and increase the participation of locals. The quality of components will obviously be affected as new workers need to be retrained, he said.
These vendors had helped with the localisation of the cars, he said, citing the Perodua Alza which had 90% local content. Aminar said 75% of Perodua's sales and services were undertaken by independent entrepreneurs. We are creating business opportunities for our dealers and providing them not only with products, but also training development to make sure they are competent, he said.
To date, Perodua has invested about RM3bil mainly for its plant as well as its sales and distribution division, to the extent that there are more independent dealers than its own outlets. It currently has more than 11,000 employees, of whom 8,000 work at its plant in Rawang.
Aminar said Perodua also aimed to at least double its engine components export business to RM50mil by increasing trade around the South-East Asia region in the next three years. We are at the tail-end of a feasibility study to export to Thailand and we are currently exporting to countries like Pakistan, Indonesia and Japan, he said. The company is also looking at opportunities to export completely-built-up units to South Africa.
Perodua's shareholders are UMW Corp Sdn Bhd, which holds a 38% equity; Daihatsu Motor Co Ltd of Japan, 20%; MBM Resources Sdn Bhd also 20%; PNB Equity Resources Corp Sdn Bhd 10%; Mitsui & Co Ltd 7% and Daihatsu (M) Sdn Bhd 5%.
On Perodua's foreign partner, Aminar said the relationship with Daihatsu had been a successful partnership. The important factor with Daihatsu is that they have been around much longer and are more knowledgeable with vast experience, not just in technical aspects but also technology that involves huge sums of money. It helps small players like us understand the challenges to being export-driven, sharing of resources and platform, as well as huge amount of data that we can benchmark ourselves against, he said.
On car sales, he said as at end-October, Perodua was the top selling carmaker with a market share of 31.1% at 157,200 units. Our target to sell 185,000 cars this year is achievable and we have already revised upwards next year's target to 190,000 units. He attributed the stellar performance to star model, the Myvi, which contributed 41.1% to total sales this year, followed by the Viva, which accounted for 37%, and Alza 22%.
Competition is everywhere and it has kept us on our toes all the time. Customers have a choice and our performance is determined by them, he said. We are driven by market forces. We had put a lot of emphasis on the whole gambit of the auto business like our showrooms, networks, customer cars, product line-up improvement and retention programme.
Aminar said he hoped Perodua would retain its top spot on the country's car sellers list this year for the fifth consecutive year. - Bernama
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