D74A Perodua Axia will remain on sale until 2029 - Three years less than before

The newly launched D74A generation 2023 Perodua Axia will have a 6-year model lifecycle, suggests a Bursa Malaysia filing by Perodua vendor Betamek Bhd.

On the same day the all-new 2023 Perodua Axia was launched, Betamek released a notification to Bursa Malaysia saying that its subsidiary Betamek Electronics (M) Sdn Bhd has received a Letter of Appointment dated 25 January 2023 issued by Perodua, for a contract to supply various electronic parts for Perodua new car model.

The filing to Bursa did not mention the name of the Perodua model but said, “The supply of these parts has commenced in the fourth quarter of the financial year ending 31 March 2023,” which is this quarter. Clearly the new Perodua model mentioned refers to the Axia.

Betamek says the contract is expected to generate approximately RM 123.5 million in revenue over a 6-year period – indirectly implying the duration of the D74A generation Axia’s planned model lifecycle.

This would mean that the D74A Axia will remain in production until 2029.

The all-new Axia’s 6-year model lifecycle is significantly less than the previous generation Axia – which stayed on the market for 8.5 years, with two facelifts in between, one in 2017 and another in 2019.

The RM 123.5 million contract to Betamak is just a small fraction of the RM 10 billion spending on local vendors budgeted by Perodua for 2023. The figure is 26.5 percent more than what it spent on local vendors in 2022 (RM 8.3 billion).

With the launch of the all-new Axia, all Perodua models now have a local content of ratio of 95 percent.

When a local car company mentions 95 percent local content, it doesn’t necessarily mean that 95 percent of the car is produced locally. A car is made up of tens of thousands of parts, including many child parts that come from other countries.

It is impossible for one country to manufacture 95 percent a car on its own. Not even Germany, Japan, or USA do that. The whole point of establishing global supply chains is to get the best prices, regardless of the country of origin.

This global supply chain is also why China’s zero-Covid policy and Russia’s invasion of Ukraine have messed up production plans of nearly every car manufacturer worldwide, resulting in long waiting periods for so many new models.

The 95 percent local content simply means that 95 percent of the finished parts that went into the car are sourced from local vendors. This may include modules that are assembled from imported child parts.