Perodua: Record high sales for 2022 but economic headwinds in 2023 could erase gains made

• Perodua targets 11.3 percent increase in sales for year 2023, to 314,000 units
• TIV to stay above 700,000 units but economic headwinds remain a risk
• No increase in prices of existing models, as increase in raw materials cost is already absorbed by Perodua

After ending 2022 with a record breaking 282,019 cars sold, Perodua is now the fourth largest car brand in the Southeast Asia’s ASEAN trade bloc’s five largest markets of Indonesia, Thailand, Malaysia, Philippines, and Vietnam.

Starting the new year in 2023, Perodua announced today a 314,000 units sales target for this year. Much of this will be supported by the introduction of a new generation 2023 Perodua Axia, details of which will be announced in mid-February.

Despite on-going challenges from inflation and shortage of semiconductor parts, Perodua says Malaysia’s automotive industry has adapted to this ‘new normal’ and is confident that 2023’s Total Industry Volume (TIV, an industry lingo for total new car sales) will stay above 700,000 units, which is higher than the Malaysia Automotive Association’s own projection of 650,000 units.

The above is contingent on Bank Negara keeping interest rates stable, and no further sharp increase in raw material costs - which Perodua says should stabilize / come down by the second half of this year.

Typical of Perodua’s cautious character, the company’s management will always balance positive projections by highlighting potential risks on the horizon.

At today’s 2023 Outlook briefing to the press, Perodua President and CEO Dato’ Sri Zainal Abidin Ahmad said 2023 risk factors include higher inflation, further increase in interest rates and higher external cost factors such as fuel, power as well as higher commodity and raw material costs.

“These cost factors, if rise too steeply will have a negative impact to the momentum that we are currently on. The increase may not only have the potential to depress the market but also erase gains made by the industry as it was just getting its second wind,” Dato Sri Zainal said.

He added that the semiconductor ship supply was still a factor for manufacturers, not just for automotive players but industries such as electric and electronics and other heavy industries that rely on the technology.

“We are monitoring this factor closely but as of now, we are positive that we have the chips needed to meet out targets,” Dato Sri Zainal said, who also stressed that Perodua is absorbing the increase in cost of raw materials, and that there will not be any increase in prices of existing models.

As for 2023 Perodua Axia, which has 10 percent higher estimated price of between RM 38,600 to RM 49,500 (when compared between similar variants), Perodua says the increase is purely due to the much higher level of specifications, and the fact that is now a bigger car (a crossover body is hinted).

Also read: D74A 2023 Perodua Axia: Bookings opened, 6 airbags, VSC standard

Details will be released in mid-February but Perodua has confirmed that the highest specifications Axia AV variant will have 6 airbags, LED daytime running lights, 9-inch infotainment screen, 7-inch digital instrument panel, Smart Drive Assist suite of ADAS.

There’s also a new more fuel efficient D-CVT-type automatic transmission that contributes to a very low 27.4 km/litre (3.65-litre/100 km) when tested under Malaysia Driving Cycle, which is a localized version of the United Nation’s R101 test cycle, minus cold weather requirements.

The engine will remain the same as the outgoing model’s 1.0-litre naturally aspirated 3-cylinder 1KR-VE unit.