Sime Darby Motors seeks new partners

  • Business
  • Monday, 08 Jul 2019

Hard at work: A view inside the Inokom plant in Kulim. Sime Darby Motors currently assembles BMW, Mini, Hyundai and Mazda vehicles at the plant.

KULIM: Sime Darby Bhd’s automotive arm, Sime Darby Motors, is in talks to attract new business partners to set up operations within its 200-acre manufacturing facility here.

Sime Darby Motors Malaysia, Thailand and Taiwan managing director Dennis Ho said securing any of the investors as partners would be “a game changer” for the group.

“We are talking to more than two parties and hope to finalise something by year-end,” he told reporters following a visit to the group’s manufacturing plant here, last Thursday.

Ho said Sime Darby Motor was competing with other regional countries to secure these potential partners.

“Other countries in the region such as Thailand and Vietnam are offering various incentives to attract foreign automakers to set up base here and we have to compete with them.”

The 200-acre facility is owned by Sime Darby Motors’ subsidiary Inokom Corp Sdn Bhd. Sime Darby Motors has a 51% stake in Inokom, while Bermaz Auto Bhd, South Korea’s Hyundai Motor Co and Sime Darby Hyundai own 29%, 15% and 5% respectively.

Sime Darby Motors currently assembles BMW, Mini, Hyundai and Mazda vehicles at the Inokom plant.

About 35% of the total vehicles produced here are for the export market.

Ho: We are talking to more than two parties and hope to finalise something by year-end.

“At the moment we only export vehicles with internal combustion engines. But we hope to start exporting plug-in hybrid electric vehicles (PHEV) in the next three years,” said Ho.

“Currently, we’re the largest PHEV manufacturer in Malaysia.”

Sime Darby Motors also has a separate, dedicated facility in Kulim that manufactures BMW engines.

Ho said Sime Darby Motors’ affiliation with the German automotive giant provided a huge advantage in securing potential foreign partners.

“We’re confident of our prospects of securing a business partner because of our ties with BMW.

“Therefore, we have the flexibility, capability and credentials to offer these players the opportunity to grow their business.”

Ho added that Sime Darby Motors also intends to expand its manufacturing facility by another 50 acres over the next three years to accommodate the new partners coming in.

“The expansion will be for vehicle assembly and additional activities. We also plan to ramp up our annual production capacity to 50,000 units from around 40,000 units currently within the next three years,” he said.

To date, around 110 acres of the facility has been utilised.

Sime Darby Motors’ 2018 profit before interest and tax stood at RM543mil, on revenue of RM20.3bil.

Total assets last year stood at RM9.8bil.

Apart from its assembly business, Sime Darby Motors is also involved in vehicle importation, distribution, retail and rental.

Among the brands under its portfolio include BMW, Jaguar, Land Rover, Porsche, Ford and Hyundai.

Ho said Sime Darby Motors is targeting to sell 75,000 units for 2019.

“Year-to-date, we have already sold 65,000 units, so we are on track of hitting our target for this year,” he said.

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