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Tuesday, January 31, 2012

Perodua NO.1 for 6th year

Close fight but Perodua beat Proton to the Top Spot for Best-selling cars in Malaysia.

SOURCE: Click me:

Jeff Lim's Note: My dad was 1 of the Contributor in October 2011. He bought a MYVI 1.5SE+ Auto.  

Though the battle for No. 1 place looked like a closer fight between the two national carmakers this year than previous years, Perodua again retained the top spot in Malaysian new vehicle sales in 2011 for the sixth consecutive year. It delivered 179,989 units of the Myvi, Viva and Alza to take 30% of the Malaysian market, a marginally lower share and volume than the year before.

Speaking at a media briefing this morning, Perodua MD Datuk Aminar Rashid Salleh said it had been a tough year with interruptions to parts supply due to the three disasters in Japan as well as the delays in loan approvals that occurred due to the more stringent new H-P regulations. Fortunately, the latter issue (which also affected other companies) was addressed after appeals were made to the Ministry of Domestic Trade & Industry to allow some flexibility in the process.

The biggest contributor was, of course, the New Myvi which went into the second generation during the year. Some 78,000 units were sold while the Viva and Alza were also very popular choices, accounting for 34% and 30% of the total Perodua volume, respectively.

Datuk Aminar Rashid proudly announced that some new records had been set in 2011: the highest-ever market share in a month (38.4% in December with 18,203 units sold) and the highest-ever sales in any quarter of the year (around 52,800 units from October to December).

The company has also given a lot of attention to the after-sales side of the business which is crucial to its profits as its margins on each car is not substantial due to the need to maintain prices at affordable levels. The efforts have paid off as parts sales totaling RM205.1 million were the highest ever achieved and during the year, some 1.71 million vehicles were attended to at Perodua service centres nationwide. That translates into something like 51% of all Perodua vehicles currently in use.

1.71 million vehicles were attended to at Perodua service centres in 2011, 
which is equivalent to 51% of all Peroduas in use today

Having made a commitment to the government to increase exports, Perodua doubled the number of units sold overseas overseas to 8,000 units from 4,000 units in 2010. This year, the company is aiming to export 10,000 units and by 2015, it is targeting export volumes to be 20,000 units. 

Currently, Perodua exports its vehicles to seven countries – Singapore, Brunei, Mauritius, Fiji, Sri Lanka, Nepal and the UK. Sri Lanka is said to be its most active market at the moment. The Myvi produced at Perodua’s plant is also taken by Daihatsu, its technical partner, for sale in Indonesia as the Daihatsu Sirion.
When asked why Perodua’s export program has been slow, given the many years that the company has been in business, Datuk Aminar Rashid said it was due to a few factors. One of them was the high domestic demand which limited how many could be exported. The absence of left-hand drive variants also prevented Perodua from entering a number of markets where there was interest by dealers, and finding good dealers to represent the brand took time.

Another factor has been production cost which Perodua has been working hard to bring down. It has made great progress in this area through greater productivity and efficiency in its operations, but the economies of scale are still not as high as they should be for the export business to be sufficiently profitable.

Besides whole vehicles, Perodua also exports engine components to Indonesia, Japan and Pakistan for use by assemblers of Daihatsu models. The components include cylinder heads, cylinder blocks, crankshafts, intake manifolds and pistons. Perodua’s component manufacturing activities have enabled its models to reach up to 90% local content (in the Alza), satisfying government expectations for more local sourcing of parts.

Perodua will soon have locally-made electronic automatic transmissions when a new factory is completed in 2013. Initial output from the factory, which will be majority-owned by a technical partner, will be 130,000 units annually and increasing to 200,000 units in due course.

The plant capacity is 250,000 units a year on 2-cycle shifts and there are no plans are to build another factory yet. Some capacity has been freed up as Perodua is no longer doing contract assembly of the Toyota Avanza. While this is welcome by Perodua, Datuk Aminar Rashid said that the earlier contract assembly work was also valuable in that it required the plant to fully adopt the Toyota Production System, widely acknowledged as a superior manufacturing system.

“In order for us to make vehicles for Toyota, we had to upgrade our standards to those which Toyota sets and they are very high,” he said. He revealed that by 2015, the goal is to have 0.05 defects per unit (DPU) at the end of the assembly line, a measure of quality which is exceptionally high. At this time, Toyota plants in Thailand and Indonesia have a 0.1 DPU rate.

Looking ahead, Perodua has set a target of 188,000 units in 2012 which is a 4% increase, taking into consideration the various challenges that are expected. “Barring any unforeseen circumstances, we believe we can meet this target,” said the Perodua MD. 

Under its strategic 5-year plan, the company is also investing heavily in after-sales services to further boost customer satisfaction. Almost RM15 million will be spent on upgrading of outlets and service facilities.  By the end of 2012, there should be 192 branches and dealers throughout Malaysia where people can buy and service Peroduas.
A new flagship outlet is being built in Petaling Jaya, Selangor, which will enhance the image of the brand. It will serve as an example of the new standards for Perodua and will also become a regional headquarters as part of the decentralization exercise.

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