KUALA LUMPUR: Tan Chong Motor Holdings Bhd is confident that the floods in Thailand will not adversely impact its production of Nissan cars for the near term.
“We assemble our cars but normally the business approach is to keep two to three months’ stock,” said Datuk Dr Ang Bon Beng, executive director of Edaran Tan Chong Motor Sdn Bhd, a subsidiary of Tan Chong.
Tan Chong has the mandate to distribute and manufacture Nissan cars in Malaysia, with its unit Edaran Tan Chong Motor, the trading and marketing arm for Nissan products.
However, if Thailand does not recover in the next two to three months, Tan Chong could have problems sourcing parts which in turn could lead to the group being unable to produce and deliver cars to customers on time, Ang said.
Ang added that he has confidence in the Nissan recovery team members as they have been working with Nissan Thailand to address the situation at hand.
He said if the Nissan team was able to handle Japan’s tsunami and earthquake in March, then the task force would have little difficulty in resolving this problem efficiently and effectively.
There are also other alternatives, such as sourcing parts from China, Japan or Asean countries, Ang added.
For the first six months ended June, Tan Chong posted a net profit of RM130.54 million on RM2.07 billion in revenue. The company’s earnings per share (EPS) stood at 20 sen.
In the corresponding period of FY10, Tan Chong registered a net profit of RM128.33 million from RM1.8 billion in sales. Tan Chong’s EPS for the first six months of FY10 was 19.66 sen.
“We are seeing stability and consistency in terms of CKD (completely knocked down) deliveries for the first time since the disaster in Japan,” it said.
“With most of the bad news behind us and the economy indicating stability, if not mild acceleration, consumers are returning to showrooms even without an increase at incentive levels,” Tan Chong said.
Ang made these observations after launching the new Nissan Livina X-Gear, the first CKD B-segment crossover car, last Friday.
He is bullish on sales of the X-Gear to date. Since the first launch in mid-September, the company has received orders for 1,500 units, above Edaran Tan Chong Motor’s expectations of between 500 and 600 units, Ang added.
Edaran Tan Chong Motor plans to penetrate at least 5% of the B-segment market with the introduction of this car, said Ang.
The group also plans to increase its overall total industry volume (TIV) market share next year to 6.7%, from the current 5.7%, and will open no fewer than 10 showrooms in the next five years throughout Malaysia.
Tan Chong ended trading last Friday unchanged at RM4.46.
This article appeared in The Edge Financial Daily, October 24, 2011.
“We assemble our cars but normally the business approach is to keep two to three months’ stock,” said Datuk Dr Ang Bon Beng, executive director of Edaran Tan Chong Motor Sdn Bhd, a subsidiary of Tan Chong.
Tan Chong has the mandate to distribute and manufacture Nissan cars in Malaysia, with its unit Edaran Tan Chong Motor, the trading and marketing arm for Nissan products.
However, if Thailand does not recover in the next two to three months, Tan Chong could have problems sourcing parts which in turn could lead to the group being unable to produce and deliver cars to customers on time, Ang said.
Ang added that he has confidence in the Nissan recovery team members as they have been working with Nissan Thailand to address the situation at hand.
He said if the Nissan team was able to handle Japan’s tsunami and earthquake in March, then the task force would have little difficulty in resolving this problem efficiently and effectively.
Ang: The business approach is to keep two to three months' stock.
There are also other alternatives, such as sourcing parts from China, Japan or Asean countries, Ang added.
For the first six months ended June, Tan Chong posted a net profit of RM130.54 million on RM2.07 billion in revenue. The company’s earnings per share (EPS) stood at 20 sen.
In the corresponding period of FY10, Tan Chong registered a net profit of RM128.33 million from RM1.8 billion in sales. Tan Chong’s EPS for the first six months of FY10 was 19.66 sen.
“We are seeing stability and consistency in terms of CKD (completely knocked down) deliveries for the first time since the disaster in Japan,” it said.
“With most of the bad news behind us and the economy indicating stability, if not mild acceleration, consumers are returning to showrooms even without an increase at incentive levels,” Tan Chong said.
Ang made these observations after launching the new Nissan Livina X-Gear, the first CKD B-segment crossover car, last Friday.
He is bullish on sales of the X-Gear to date. Since the first launch in mid-September, the company has received orders for 1,500 units, above Edaran Tan Chong Motor’s expectations of between 500 and 600 units, Ang added.
Edaran Tan Chong Motor plans to penetrate at least 5% of the B-segment market with the introduction of this car, said Ang.
The group also plans to increase its overall total industry volume (TIV) market share next year to 6.7%, from the current 5.7%, and will open no fewer than 10 showrooms in the next five years throughout Malaysia.
Tan Chong ended trading last Friday unchanged at RM4.46.
This article appeared in The Edge Financial Daily, October 24, 2011.
