Interview with Datuk Dr Ang Bon Beng director Nissan Malaysia
Edaran Tan Chong Motor Sdn Bhd (ETCM) executive director Datuk Dr Ang Bon Beng spoke about the company's strategies during an economic downturn is like listening to an army general prepare his soldiers for war. His office is riddled with charts, coded notes and the latest information about the local automotive industry.
He paces up and down like a general as he explains how ETCM plans to "weather the storm" ahead. "The car market is just like war. To be successful, everyone needs to move in one direction. Otherwise, you won't achieve the optimal results that you desire.
"If everyone is moving in different directions, you will be exposed and become vulnerable to attacks from your competitors," he tells StarBizWeek in an interview. Under Ang's helm, ETCM has adopted an aggressive approach.
"I tell my people that as these are hard times, they need to have a strong mindset. We need to do more but expect less," he says. Ang is certainly bucking the trend and his formula appears to be yielding results. For the first quarter of 2009, ETCM sold 6,638 units, up 6.2% from 6,253 units during the previous corresponding year.
While total industry volume (TIV) during the same period dropped 9.2% to 118,681, ETCM's market share of total industry volume rose to 5.6% from 4.8% previously. Ang expects the TIV for Q2 to improve from Q1.
Its best seller is the Nissan Grand Livina MPV, which accounts for over 40% of the company's total sales as of February 2009, with 1,827 units sold during that period. Ang points out that the Grand Livina is largely popular because of its starting price of RM 84,500 (US$ 23,472) (on-the-road, with insurance) and it is great value for money, providing up to 56.6 km per litre.
"It is easy to maintain. All you need to do is fill up and drive," he says. Ang says ETCM regularly tweaks its sales target in tandem with the current economic situation and as such, he does not have a specific (sales) target for 2009, adding that the company is focused on building market through the year.
"We are targeting a 1% increase in market share to 6% (of TIV) by year-end," Ang says. To minimise cost, ETCM's new car launches will consist of completely-built-up (CBU) models rather than completely-knocked-down (CKD) as the company would have to spend RM20 million extra to build a new CKD model.
ETCM plans to launch "Halo" models in the second half of the year. A Halo model refers to a vehicle designed and marketed to promote a brand to create a halo effect around the vehicle and thereby create positive associations related to the brand. "We want to create more excitement and variety in our showrooms and increase (showroom) traffic."
Ang drops a hint that the second-generation Nissan Murano sports-utility vehicle and the sixth generation Nissan 370Z, the latest in the Nissan's Z-car line, are among the Halo vehicles the company plans to launch this year. It will also launch the manual version of the Nissan Navara sport utility truck in the third quarter of the year, which will be priced 10% lower than the RM105,000 automatic variant already available in the market.
The company will also introduce the Sylphy sedan tuned by Impul in the second half of the year. Ang says that all the CBU models that it plans to launch this year would be imported from either Japan, Indonesia or Thailand.
"Impul helps to give additional 10% to 15% sales because it offers a new look to our existing model range," he elaborates. However, one area that needs to be strengthened is its presence in the local passenger car segment. Ang says that because ETCM's range of models are limited, the company is largely unrepresented in the local passenger car segment.
About 60% of the passenger car market is dominated by models within the A (Perodua Myvi) and B (Toyota Vios, Honda City) segments. ETCM currently has no models within these segments. "We have plans to bring in more models for the A and B segments. These models can add about 2,000 units (in sales) per month, giving us an additional 24,000 units per year to the 20,000 to 30,000 units a year that we are already selling."
"With more models we can already sell 50,000 to 60,000 units a year and no longer be a small player within the local automotive industry," he continues.