“Auto and autoparts sector poised for another record-breaking year”
21 Sep 2023
The auto and autoparts sector is poised to have another record-breaking year if the monthly total industry volume (TIV) levels are higher than expected for the remainder of the year.
August TIV of 72,000 brought year-to-date TIV to 502,000 units (+12.7 per cent month-on-month (MoM), +6.1% per cent year-on-year (YoY)).
August saw a strong MoM increase, mainly from the Japanese carmakers – Honda and Toyota, which rose by 30 per cent and 23 per cent – likely driven by their order backlogs.
Perodua and Proton both posted single-digit MoM growth, at 4.6 per cent and 9.4 per cent each.
Chinese EV carmaker BYD also recorded stronger sales this month with a 43 per cent MoM rise.
RHB Research noted that strong deliveries in the second half of 2023 (2H23) will be mainly supported by marques with large outstanding order backlogs, which are largely fuelled by new model launches, for example, Perodua Axia and Toyota Vios.
However, it noted that 2024 TIV will likely soften year-on-year (YoY) based on the lack of catalysts to support the high orders and deliveries, especially if 2023 TIV hits a record high.
“Our channel checks with industry players indicate that the 2024 outlook remains hazy.
“We are also expecting the order backlog of the major marques to gradually ease throughout the fourth quarter of 2023 (Q4 2023).
“While stronger electric vehicle adoption may provide an upside risk to 2024 TIV, we do not think this will be significant enough to move the needle,” it said.
The firm favours Bermaz Auto Bhd for to its nine per cent yield and its car sales are expected to remain resilient relative to other marques.
The firm kept its “Neutral” call on the sector premised on an uncertain 2024.
Source: NST
