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Perodua weathers the storm

NO doubt that the year 2015 took a toll on many businesses due to the decline in Malaysia’s currency value, the implementation of the Goods and Services Tax (GST) as well as the drop in global oil prices.

And especially in the local automotive industry, national car manufacturer Perodua was not sparred.

Having said that, the group managed to surpass the 200,000 sales threshold last year, having sold a total of 213,300 vehicles backed by the strong demand of the Axia, Myvi and Alza models.

As an added sweetener, Perodua also witnessed the largest production of vehicles in its history with 228,500 units manufactured, a 16.3 percent increase from the 196,400 units produced in 2014.

On its after sales side, it broke another record with 1.96 million intakes last year, compared to the 1.92 million intakes reported in the preceding year. The increase was attributed to the additional upgrades to its existing service facilities.

Perodua currently owns 181 sales and 190 service centres nationwide.

On the parts and accessories front, the group posted revenues of RM248 million last year – a 2 percent increase from the RM244 million it raked in in 2014.

All things considered, Perodua’s market share currently stands at 32 percent.

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Perodua president and CEO Datuk Aminar Rashid Salleh said that the company will remain ‘cautiously optimistic’ despite its achievements last year.

“Last year was a very challenging period for us as the implementation of the GST, the weakening Ringgit as well as the slump in oil prices had big impacts on the country’s economy,” Perodua president and chief executive Datuk Aminar Rashid Salleh said at the company’s performance review this week.

“As a result, many customers have decided to ‘buy down’ to more affordable alternatives such as the Axia, which accounted for 99,700 units of 46.7 percent of our entire sales for 2015.”

However, Aminar revealed that although the number of new vehicles registered increased last year, the group’s profit had “deteriorated” due to the fluctuations in exchange rates particularly the US Dollar and Japanese yen as well as higher sales of lower spec variants.

“Though our sales volume increased, we are selling more of the lower spec and lower priced models. Having said that, we are cautiously optimistic about 2016 and hope to raise the number of vehicles sold from 213,000 units to 216,000 units,” Aminar said.

On a similar note, Perodua has revised its allowances for the year, aiming to bring down its capital expenditures to about RM370 million this year, as opposed to theRM1.56 billion and RM408 million spent in 2014 and 2015 respectively.

“Most of the capex for 2014 was spent developing our new plant,” Aminar said. To recap, the company opened the doors to its first EEV plant in Rawang, Perodua Global Manufacturing Sdn Bhd, last week.

He added: “It is going to be another tough year for us. But we have the right models that will ride out the difficult times ahead.”

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