Report: Kenanga IB Maintains 2025 TIV Forecast Of 805,000 Units

Kenanga IB reportedly stated that it will maintain its 2025 TIV forecast of 805,000 units for the local auto industry.

Kenanga Investment Bank Berhad (Kenanga IB) elected to maintain its 2025 total industry volume (TIV) forecast of 805,000 units for the local automotive industry, reports local newswire Bernama. 

The firm notes that forward buying interest following the government’s decision to defer new excise duty regulations will fuel said figure.

Kenanga IB also noted that automaker Perodua is set to benefit the most thanks to its high localisation rate, attractive new model launches, rising households incomes, and a stable labour market.

 In a note reportedly released by the firm, it also pointed out that automaker Perodua will likely benefit the most too – it currently holds a 44% share of the TIV market. The firm adds that Perodua’s advantage stems from its high localisation rate, attractive new model launches, rising household incomes, as well as a stable labour market.

For the premium segment however, Kenanga IB warned that upper tier M40 and T15 consumer groups may hold back from buying new cars once the planned RON95 subsidy rationalisation takes effect later this year. It adds that consumers here might also downgrade to smaller cars or even switch to hybrid (HEV) and electric (EV) alternatives.

In general though, Kenanga IB says the industry’s earnings visibility remains well as it is backed by a 150,000-unit backlog of bookings as of end of Dec 2024. “More than half of the backlog is made up of new models, alluding to the appeal of new models to car buyers. This trend is likely to persist throughout 2025 given a strong line-up of new launches,” notes the firm further.

Kenanga IB's forecasts also predicts more upper-tier M40 and T15 consumer groups switching to either hybrids or fully electric (EV) alternatives with the impending RON95 subsidy rationalisation.

Kenanga IB also expects the government to speed up approvals for setting up charging stations, which currently totals at 3,354 built thus far.

Additionally, Kenanga IB adds that vehicle sales will be supported by sales of new EVs that still enjoy and benefit from the sales and service tax (SST) exemption, plus other EV facilities incentives. As a refresher, these are all set to last until end of this year for fully imported (CBU) models, and until of 2027 for localised (CKD) offerings.

With EVs, the investment banking firm expects more favourable incentives offered by the government as it seeks to achieve its target of having hybrids and EVs make up for at least 20% of thew TIV by 2030. This target raises to 38 by 2040 as well. Surely, this will need to be aided with improved EV-charging infrastructure.

“The government will speed up the approval for charging stations. The number of proposed charging stations is currently at 4,235 (3,354 built to date), and this should more than double to 10,000 by end-2025,” says Kenanga IB optimistically regarding the state of the country’s EV charging infrastructure.