PETALING JAYA: Perusahaan Otomobil Kedua Sdn Bhd (Perodua) is targeting to hit a production volume of 330,000 units driven by outstanding orders carried forward from 2022 coupled with a strong demand for its marques so far this year
Perodua’s expected production volume for 2023 is a 14.2% year-on-year (y-o-y) increase from last year’s 289,054 units. The local car maker is also eyeing an 11.3% y-o-y rise in its sales this year, to 314,000 units from 282,019 units previously.
On this note, Perodua president and chief executive officer Datuk Seri Zainal Abidin Ahmad is more bullish than the Malaysian Automotive Association on this year’s total industry volume (TIV), saying it will not fall below 700,000 units.
“More than half of our targeted volume is from bookings we collected last year but have yet to deliver. We believe that the TIV can go beyond the Malaysian Automotive Association’s forecast of 650,000 units. At present, the total outstanding booking that we have is 220,000 units,” he said at a briefing yesterday. Perodua is also aiming for an 11.3% y-o-y increase in its registration volume and a market share of 44.5% this year.
Going into 2023, Zainal said Perodua’s main focus is to deliver on the outstanding bookings and spare parts. For this, the group will boost its logistics and warehouse management and stabilise its stock.
“Our second initiative is to boost our manufacturing capacity which can be achieved through product mapping, digitalisation, drivetrain systems, and enlargement of manpower capabilities. We will continue to develop our suppliers and ecosystem so that they can cope with the jump in production,” he said.
In a bid to boost production, Perodua has set aside RM10bil to purchase parts from local suppliers. This figure is higher than last year’s allocation of RM8.3bil.
Furthermore, Zainal noted the group has earmarked RM1.15bil of capital expenditure to enlarge its pre-owned vehicle and subscription business.
“We have allocated RM537.1mil on the development of multiple new models (to be launched in 2024 and 2025) as well as RM247.1mil to further modernise our operations, which includes upgrading existing 1S (standalone sales room) and 2S centres (service and spare parts centre) into 3S centres (combination of 1S and 2S),” he said.
Zainal noted that in fulfilling the order backlog, the group is prepared to absorb the sales and service tax (SST) for customers who will not receive their orders by March 31, 2023.
There are an estimated 15,000 to 20,000 outstanding vehicles that were booked prior to June 30, 2022, entitled to tax holidays.
“We will honour what was promised to our customers. We plan to produce 330,000 units this year and we hope that with this volume, the backlog of 220,000 units will be resolved.
“However, there will definitely be a spillover and some may not be able to get their cars before the end of March.
“As such, we are prepared to absorb the SST for customers who are entitled to SST exemptions,” he said.
Moreover, Zainal also opined that raw material induced price hikes for its existing models will not take place, at least for this year.
“I personally do not expect prices of materials to increase anymore as it has peaked. As the economy and businesses make a recovery, prices of materials should start to stabilise before coming down by the mid year.
“Instead, any price increase will be related to the different specifications across different models,” he said.