Bermaz Auto executive chairman Tan Sri Ben Yeoh.
SHAH ALAM: When Bermaz Auto Bhd
(BAuto) announced that it was buying a substantial stake in EP Manufacturing Bhd (EPMB), many wondered if this was a move to diversify its income stream given the challenges faced in the stiff competitive environment.
Its executive chairman Tan Sri Ben Yeoh said this move was mainly to support the automotive parts and components manufacturer, which is looking to raise RM39.65mil to partly finance the construction of its manufacturing hub in Melaka.
“This is part of (our move) in supporting our vendor. They are involved in the supply (of our parts) and our investments are basically to support our Mazda manufacturing programme. They did a lot for us in terms of our CKD (completely knocked down) operations,” Yeoh told StarBiz.
BAuto currently distributes and assembles selected Mazda and Kia marque models via its 29% owned Inokom Corp Sdn Bhd, which is a contract assembler of passenger vehicles, with a plant in Kulim, Kedah.
On Sept 11, EPMB announced the placement of 30% of its issued share capital, 15% each to its largest shareholder Mutual Concept Sdn Bhd and Bermaz Capital Sdn Bhd, involving a total of 66.08 million shares at 60 sen each.
Post-placement, Mutual Concept’s stake in EPMB will increase to 19.01% of its enlarged share base of 286.37 million shares while Bermaz Capital will own 11.54%.
Meanwhile, local car players, including BAuto are expected to find ways to alleviate the intense competition mainly due to the influx of competitively-priced Chinese-made vehicles.
For the first quarter ended July 31, 2024 (1Q25) BAuto saw a 30% year-on-year (y-o-y) decline in its net profit to RM70.2mil.
It posted a more than 20% y-o-y drop in revenue to RM846.2mil due to lower sales volume from its domestic operations, which was impacted by the launching of several new and facelift models by other marque distributors.
However, Yeoh was unperturbed as it is normal cyclical nature to face ups and downs and it would not engage in a price war.
“Basically, there’s a price war in the market and we want to stay away from that because I believe in the continuous faith in our brands from our consumers and we will continue to provide that kind of service and engagement with our customers to make them confident.
“Our car brand has been reliable, and we have no issues with it,” he said at the sidelines after the launch of Kia Asia Pacific training centre here yesterday.
Kia Asia Pacific Sdn Bhd said it is solidifying its presence in Malaysia with the opening of a RM3mil training centre in Glenmarie, Shah Alam.
This is its first-of-its-kind training centre in the Asia Pacific region and will be its fifth after Germany, Russia, United Arab Emirates (UAE) and the United States.
Its president and chief executive officer Kevin Ahn said the setting up its regional headquarters here underscores its confidence in Malaysia as pivotal in its popularisation of electrified and battery-electric vehicles and other mobility services.
“The Kia Asia Pacific Training Centre is poised to lead the way in fostering a culture of innovation and exemplary service throughout the region. The centre will support subsidiaries and distributors, sales and aftersales with automotive training excellence, equipping them with all-encompassing skills and knowledge crucial to the evolving auto industry,” he said in his speech.
Ahn said Malaysia was selected out of 34 markets in Apac for its strategic location.
“Malaysia’s diverse talent pool and strong language proficiency affirm it as the ideal choice for our training hub,” he said.
The training centre’s range of advanced facilities includes high-tech classrooms, full-fledged workshops, a computerised resource centre for Kia vehicle information, virtual repair simulators, and specialised tools such as Kia diagnostic equipment.
