Posted on : 20-04-2017 | By : sabah today | In : National Business
KUALA LUMPUR— Perusahaan Otomobil Kedua Sdn Bhd (Perodua) has set a sales target of 202,000 units for 2017, a contraction of two per cent from the 207,1000 units recorded in 2016, amid a continuous challenging economic environment.
President and Chief Executive Officer Datuk Aminar Rashid Salleh said despite a three per cent contraction in sales performance for 2016 as compared to the initial target of 216,000, market share last year grew to 35.7 per cent from 32 per cent, the company’s highest on record.
On the total industry volume (TIV), Perodua sees a slight improvement to the market with two per cent growth to 590,000 units this year, from 579,600 in 2016.
“Based on this projection, we target to capture 34 per cent of the market share or sell surpassing the 200,000 mark at 202,000 vehicles in 2017,” he said at the Perodua 2016 Performance Review here today.
Aminar said Perodua’s conservative sales target for 2017 will translate into a decline.
“Under very tough market conditions and probably because other players also face challenges, the industry’s TIV for last year contracted 13 per cent, but we dropped just three per cent.
“We forecast the market to continue to be tough this year as shown in the number of bookings and as competition also gets tougher,” he added.
He said if for any reason there was an improvement in the economic indicators, Perodua would review upward, the target for the year.
Despite the tough sales environment locally, Aminar said Perodua grew export volume by six per cent last year to 4,700 units from 4,400 in 2015, with 63 per cent being to Indonesia.
On the profitability strategy this year, he said Perodua would focus more on after sales for revenue growth.
On capital expenditure (Capex), Aminar said Perodua’s spending would be higher at RM557 million this year, compared to RM492 million in 2016, aimed at improving equipment, process flow, and improving productivity at current plants as well as improving the network.
On impact of the weakness in the ringgit, Aminar said it had an effect on costings for Perodua.
“We do import parts in the US dollar and yen. However, it is somewhat mitigated by our higher localisation.
“We will continue to monitor the situation. At this point, we are continuing to absorb (the weaker ringgit’s impact) and have no plans to review prices,” he added.
Aminar also shared that 2017 marked the beginning of Perodua’s new Transformation 2.0 programme, a five-year roadmap from 2017 to overcome future challenges and the economic environment.
“Our vision is to be a leading affordable automotive brand regionally with global standards,” he said.