Honda cautious about market

Japanese carmaker Honda is confident that it can sell some 40,000 cars in Malaysia this year, although it is cautious about the market especially in the second half.

Honda Malaysia Sdn Bhd managing director and chief executive officer Toru Takahashi said things may get tough under an increased interest rate regime.

The company expects to grow sales by 5 per cent this year to 550,000 units, beating the industry's expected growth of 2.4 per cent

"Car companies here are still sticking to their TIV (total industry volume) forecast of about 550,000 units for the year," Takahashi told reporters after launching the revamped Honda CR-V in Putrajaya yesterday.

The TIV shrank 2 per cent to 536,905 units from 548,115 units in 2008, amid the economic downturn. Honda Malaysia defied the trend, closing its book with a 19 per cent expansion to 38,783 units. Banks have increased their lending rates, following the upward revision of Bank Negara Malaysia's Overnight Policy Rate (OPR) last Thursday.

Industry observers said banks are expected to raise rates for car loans by 25 basis points as early as next week. Car loans may get more expensive in the coming months as the central bank could increase OPR two more times this year, they said. Honda Malaysia is banking on the City and Civic sedans to continue chalking up decent sales this year, besides new launches such as the facelifted CR-V.

The company sold 5,984 units in the first two months of 2010, with the January number being 3,876 units. Takahashi said it plans to launch the Honda Freed multi-purpose vehicle (MPV) by the first half of this year, but did not give more details.

It is learnt that the fully imported Freed from Indonesia will be positioned below Honda Stream as a compact premium MPV. It is expected to compete with the likes of Nissan Grand Livina, Toyota Innova, Toyota Avanza, Perodua Alza and Proton Exora. Takahashi said the improvedCR-V would sustain the monthly sales of 350 units posted by its predecessor.

Full-year sales are expected at 4,200 units, which will enable the company to sustain its 30 per cent market share in the sports utility vehicle (SUV) segment. Honda Malaysia has received prelaunch orders of 1,200 units of the upgraded two-litre SUV, which sells at RM149,980. The third generation CR-V was launched in Malaysia in 2007, chalking up total sales volume of 13,000 units.

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