CIMB Securities Expects New Vehicle Sales To Fall 7 Pct To 760,000 Units In 2025

KUALA LUMPUR, Jan 31 (Bernama) -- The total industry volume (TIV) for new vehicle sales is expected to decline by seven per cent year-on-year to 760,000 units in 2025 from last year’s 816,674, said CIMB Securities Sdn Bhd.

In a research note today, CIMB Securities said the lower forecast was primarily due to potential headwinds, such as the potential removal of the RON95 petrol subsidy in mid-2025.

“However, we anticipate resilient demand within the sub-RM100,000 segment, which remains dominated by national brands and select entry-level models from Japanese marques,” it said.

CIMB Securities estimates that sub-RM100,000 models accounted for at least 75 per cent of Malaysian TIV in 2024, with national brands commanding over 80 per cent of this segment, while Japanese and Chinese marques comprised the remaining 20 per cent.

“We expect this demand to remain robust in 2025, supported by first-time car buyers, the December 2024 civil servants’ salary hike, and an accommodative interest rate environment maintained by Bank Negara Malaysia,” it said.

CIMB Securities also forecasts a relatively stable overnight policy rate (OPR) for this year.

It said the stable OPR and the government’s plans to retain fuel subsidies for 85 per cent of RON95 users as outlined in Budget 2025 are expected to maintain affordability for the mass-market segment.

“As a result, we expect national brands to maintain their dominance, capturing a projected 64.5 per cent market share, compared with 35.5 per cent for non-national brands in 2025,” it said.

CIMB Securities maintained a ‘neutral’ rating on the local automotive sector due to a subdued growth outlook amid intensifying market competition from Chinese players.

It said key catalysts for the sector are a strengthening of the ringgit against the US dollar and Japanese yen, a reduction in interest rates, and favourable government policies aimed at reviving domestic demand.

“Sime Darby remains their top sector pick, owing to its earnings-accretive acquisition of UMW Holdings, growing exposure to Australia’s mining sector, and potential monetisation of non-core and land bank assets,” it added.

-- BERNAMA