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Honda Continues To Dominate, But Weak Ringgit and GST Weighing Down Market

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Honda Continues To Dominate, But Weak Ringgit and GST Weighing Down Market

Honda Malaysia ended the first half of 2015 by selling 43,597 cars – 17 percent higher than the same period in 2014, making it the best-selling non-national brand in Malaysia.

As of June 2015, Honda’s market share in Malaysia’s new vehicle market stood at 13.5 percent, 2.3 percent higher than the same period last year.

Honda says it is on track to meet its annual sales target of 85,000 cars for 2015.

The company adds that nearly all of the company’s models are best-sellers in their respective segments – the City, Jazz, HR-V, CR-V and Accord lead the B-sedan, B-hatchback, crossover, SUV and D-segment respectively.

The City remains the company’s best-seller, contributing 41 percent of Honda Malaysia’s sales, followed by the Jazz at 19 percent and the HR-V at 17 percent.

Earlier this year, Honda Malaysia announced that the company will be expanding its presence in East Malaysia, and had recently setup an East Malaysia Centralized Distribution Centre logistics hub to support Honda dealers in Sabah and Sarawak.

The first six months of 2015 saw Honda’s sales in East Malaysia increased by 32 percent over the same period last year.

By 2016, Honda Malaysia aims to increase its annual sales to 100,000 cars, aided by an expanded network of 90 dealers (up from the current 82 dealers).

Challenging Market Conditions Ahead

Amidst the stellar results, Honda Malaysia’s outlook for the rest of the year is mildly pessimistic. The company is revising its forecast for Malaysia’s new vehicle sales for 2015 downwards by 3.9 percent to 670,000 units, down from the 697,000 forecasted earlier this year.

Honda says the reduction was due to the weakening Ringgit, implementation of Goods and Services Tax (GST) and petrol price fluctuation that have caused weak market sentiment.

However the company is maintaining its target of securing a 12 percent market share and 85,000 annual sales by the end of 2015.

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