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Saturday, March 19, 2011

European carmakers zoom in

The Star Business: Saturday March 19, 2011

European carmakers zoom in


LAST year saw several foreign players, especially top European marques, choosing Malaysia as their base to tap the Asean market.

They include Peugeot, which had tied up with the Naza Group to make Malaysia its Asean hub and DRB-HICOM Bhd signing a collaboration and licence agreement with Volkswagen AG to manufacture Volkswagen cars at the former's production plant in Pekan, Pahang.

Industry observers reckon that European brands will also see a surge in sales over the next two years, especially with rising affluence and more affordable vehicles being introduced into the market.
And with the need for liberalisation of the local automotive industry becoming ever more pressing, European makes could be at the forefront to benefit the most.

Mercedes-Benz Malaysia Sdn Bhd (MBM)
Roland Folger says all auto players will benefit from liberalisation.
President and chief executive officer Roland S. Folger says that in tandem with the rapid pace of globalisation, initiatives to liberalise the local automotive sector will elevate Malaysia's position as a serious player in the regional and global automotive sector.

He adds that this would also create a more conducive business environment for foreign automotive manufacturers to target Malaysia as a base for direct investments and a catalyst to the industry's continued development.

“Although MBM will benefit from this, so will all the other auto players. More importantly, Malaysia will benefit as the knock-on effect would be a significant increase in terms of bilateral transfers of technology, expertise and human capital development.”

Folger says that to be able to reach a fully liberalised status, a country must have a very sound legal system in place to protect its liberalisation policies.

He says legislation from governing authorities and agencies such as the International Trade and Industry Ministry and Malaysian Industrial Development Authority have to be stringently enforced to prevent “rogue” countries contravening such policies by using Malaysia as their dumping ground for old and unwanted technologies and products.

“Malaysia, for instance, is a strong advocate of the anti-dumping policy so we are already off to a good start.
MBM sold a total of 6,970 vehicles in 2010, exceeding the company's best performance to date of 6,146 units in 2008.

BMW Group Malaysia Sdn Bhd
Geoffrey Briscoe says BMW will be able to price premium cars at more competitive prices.
Managing director Geoffrey Briscoe says liberalisation of the Malaysian automotive industry is likely to leave BMW Malaysia with the option of pricing its premium offerings at more competitive prices, thereby opening up a larger market segment to vehicles from the BMW group, including MINI and Motorrad.
“While we are already providing the full complement of BMW, MINI and Motorrad vehicles and services here in Malaysia, this levelling of the playing field will undoubtedly enhance our delivery time in introducing more vehicles, technology and innovations.”

Briscoe however feels that the liberalisation process (in Malaysia) should not be rushed or undertaken without the proper measures in place to ensure that the local automotive industry can sustain the new dynamics and increased competition that (liberalisation) would bring.

“Perhaps undertaking this process in piecemeal stages, over a period of five years would be a better method of implementation, ensuring all parties across the board are prepared for the change.”

BMW Malaysia chalked up record sales of 4,509 vehicles in 2010, which comprised 4,006 BMW vehicles, 222 MINIs and 281 Motorrads compared with 3,990 vehicles nationwide in the previous year.

Automobiles Peugeot (France)
Lionel Faugeres says Malaysia is a very important regional market for Peugeot.
Lionel Faugeres, Peugeot's general director for Asean and Pacific countries, views Malaysian as a very important market in the region.

“It is one of the largest passenger and commercial car markets in Asean and till today, over 80% of our sales in the region comes from Malaysia.

Peugeot's relationship with the Naza Group began in 2002 when the latter became an importer and dealer of the Peugeot brand in Malaysia.
This partnership subsequently led to the 206 Bestari project in 2006 which culminated in the 206 Bestari becoming one of the best selling continental models in the market.

“In 2008, we appointed Nasim as the official distributor for Peugeot in Malaysia. Nasim's track record in the Malaysian automotive industry and Naza Automotive Manufacturing's RM500mil plant in Gurun were key factors in our decision to strengthen our partnership with the Naza Group,” says Faugeres.

“In Naza's factory, we now assemble the new 207 Sedan, 308, 407 and 3008. We are currently working hard to prepare future launches,” he says.
Should the automotive industry in Malaysia be liberalised, Faugeres says Peugeot would like to see the introduction of the Euro 5 diesel as soon as possible.

“Peugeot has a wide range of vehicles that are powered by diesel engines but we have been unable to bring these vehicles here. Diesel vehicles offer more torque, less consumption and emit less carbon dioxide. As such, it is quite obvious that there are a lot of benefits in introducing Euro 5 diesel.”

Nasim Sdn Bhd, a member of the Naza group of companies and the official distributor for Peugeot vehicles in Malaysia, registered 3,000 Peugeot units in 2010 but had about 800 undelivered orders due to unavailability of certain units.



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