Naza Kia Sdn Bhd / Malaysian Car Industry

Naza Kia Sdn Bhd

The third national car seeking status is Naza Kia, which will add spice to the automotive industry. When Naza Group announced that it would begin selling cars under it’s own brand, it marked a coming of age. The group, which started in 1976 as a grey importer of used and reconditioned vehicles, today markets completely buid-up (CBU) Mercedes Benz, KIA, Peugeot, Bentley, Ferrari and Maserati apart from activities in the hospitality, public transport and other businesses. The group is the producer of Malaysia's first national multi-purpose vehicle (MPV), the Naza Ria, which is being produced at their RM350 million state-of-the-art plant in Gurun, Kedah. The plant is said to be a very efficient manufacturing facility using the latest techniques and, running at full capacity, it will produce 60,000 units per year. On another development, the managing director of Naza Kia, Tan Sri S.M. Nasimuddin S.M. Amin has stated that the Naza group was looking at expanding its activities into assembling commercial vehicles (lorries and vans) with South Korean or Chinese partners. With the current aggressive marketing climate in the automotive industry, Naza will need to put a very tight cap on costs to make sure that whatever little margin that is left after discounts and rebates will allow it to stay afloat.

 

Recent developments at Naza Kia

                  Naza Kia Sdn Bhd plans to increase its sales network to around 100 oulets this year (2004) from 84 currently as part of efforts to capture 10% share of the local motor vehicle market. Group managing director Tan Sri SM Nasimuddin SM Amin said the outlets would be based on the 3S concept (sales, service, and spare parts). He said the centres would be established in major towns throughout Malaysia. Naza Kia would spend at least RM100million to upgrade 20 of its existing sales outlets nationwide under the 3S concept. He said the expansion was necessary as more Kia vehicles were coming into the market.

                                                                    Naza Kia currently holds 7% share of the market and to achieve its target of 10% market share, it needs to expand further. Naza Kia recently launched the Kia Picanto 1.1 Mini MPV at its 3S facility. At RM46,000 each for the automatic version, the Picanto units were presently CBU (completely built up) units. According to Nasimuddin, the Picanto would be locally assembled in Malaysia by the end of 2004 or early next year, adding that the vehicle launched 3 months ago was the best selling car in Europe at the moment. Nasimuddin said only 4,000 units of the Picanto would be brought into Malaysia in 2004 although local dealers had asked for 10,000 units. As the demand for these vehicles is very good overseas, local dealers would be faced with a shortage of supply. For example, there is a long waiting list for other models such as the Carens, Sorento, and the Naza Ria MPV, but Naza Kia hopes to overcome this when its assembly plant in Gurun, Kedah which is scheduled to be completed at the end of 2004, is operational. Kia Motors expects the Picanto, which received tremendous response in Europe to make a similar impact in Malaysia. Kia models are well received in Malaysia and the country is one of the largest markets for Kia vehicles in South East Asia.