1) Perodua’s 106% MoM jump marks a fruitful return to normal production from Oct. Perodua sales have begun to normalize on the back of 22K in unfulfilled orders for the Myvi as of end-Sep. We emphasize that Perodua has not escaped the slump that followed the tax holiday as sales averaged 14.5K in the past two months, which is a decline of 29% from the average seen in June-Aug. Perodua sales have lost some steam as the new Myvi marks its first year this month: average monthly sales of 18K/month in the last 5 months are ~8% lower than the 20K/month seen in the first half year of the Myvi. However, we believe the slowing sales growth is a natural progression for the Myvi and it is a catalyst for Perodua to pave the way for its new SUV from 1Q19.
2) Toyota rebounded 58% MoM to 4.8K after dropping to 3K in Sep. This was anchored by the Hilux, Vios and Innova. The new Toyota Rush and Camry, debuting mid-Oct and Nov/Dec respectively, will provide some support in the final months of the year. We believe Toyota will be more aggressive in pursuing sales growth in FY19 with new versions of the Camry, Vios and Yaris. Sales have reverted to their unexciting mean of 4K/month seen prior to the tax holiday, which Toyota had leaned on heavily. We reiterate that Toyota had been the best at maximizing the tax holiday: which accounted for 51% of its YTD sales (vs. 40% for TIV; 40%/43% for Honda/Nissan), and during which monthly sales more than doubled to an average of 9.8K/month.
3) Nissan and Mazda are riding their flagship models to cruise past these difficult few months. Nissan has done a commendable job holding up its sales at an average of 2.3K/month after the tax holiday as it leans on the Serena SHybrid. The MPV now accounts for a third of total Nissan sales here and sees relatively stable month-to-month numbers: selling 755 units in Oct from an average of 780/month since its debut in May. Mazda sales saw average sales of 1.4K/month after the tax holiday as it relies on delivering from a massive backlog of about 6K units. We believe much of this was attributed to the CX-5 and the new CX-3, as SUVs accounted for 88% of its total sales in the past two months.
Source: AmInvest Research - 21 Nov 2018