PETALING JAYA: Malaysia’s car sales for 2024 have surpassed the 800,000 mark for the first time in history, according to preliminary data, with total industry volume (TIV) reaching about 814,000 units.
In 2023, the country came close to hitting the 800,000 mark, ending the year with 799,731 vehicles sold.
The national car makers estimate that total new-vehicle sales in December exceeded 80,000 units, pushing TIV for 2024 past the 800,000 milestone, CIMB Research said.
“Preliminary data highlights a record 2024 TIV,” the research house noted in its latest report on the local automotive sector.
With this, Malaysia would retains its position as the second-biggest car market in Asean, behind Indonesia.
Thailand, once a strong competitor, has seen a significant drop in vehicle sales.
The Federation of Thai Industries reported that in the first 11 months of 2024, vehicle sales in Thailand were 518,659 units, a decline of 26.7% year-on-year (y-o-y).
Meanwhile, Indonesia’s Association of Indonesian Automotive Industries reported a 13.9% drop in vehicle sales to 865,723 units in 2024.
Despite the strong performance in 2024, CIMB Research forecasts a more moderate outlook for 2025.
“We forecast a TIV of 755,000 units for 2025, representing a 7% y-o-y decline,” the research house said.
The expected decline is largely attributed to potential headwinds, including the possible removal of the subsidy for RON95 petrol mid-2025 and a likely revision of the open market value calculation method, which could raise excise duties.
Despite these challenges, CIMB Research anticipates resilient demand within the sub-RM100,000 segment, which remains dominated by national brands and select entry-level models from Japanese marques.
In 2024, the segment accounted for at least 73% of total TIV, with national brands holding over 80% of the market share, the research house estimated.
Citing data from the Road Transport Department, CIMB Research said total electric vehicle (EV) registrations in Malaysia rose by 79% y-o-y to 28,048 units in 2024, representing 3.3% market penetration.
The growth was primarily driven by the influx of multiple new EV models and the entry of new players into the local market.
CIMB Research said it anticipates another strong year for the EV segment in 2025 driven by new models, particularly from national car makers Proton and Perodua.
The research house maintained a “neutral” rating on the automotive sector owing to a subdued growth outlook amid intensifying market competition.
It said the sector is trading at a nine times weighted-average 2025 price-earnings multiple, which is below its five-year mean of 12.6 times.
“While this valuation discount reflects the sector’s tepid earnings growth outlook and the demand uncertainty linked to the potential removal of the RON95 subsidy, the sector offers an appealing 2024 and dividend yield of 7.1% and 7.2%, respectively” the research house said.