From the time Perodua started operations, it has always proceeded with strict commitments to whatever has been planned. Of course, reaching the stage where the plans are finalised and then set requires thorough study and discussion but once they are sure, they stick to the plan and schedules set.

Recently, the carmaker announced that it would be increasing component purchases by 20% to RM6 billion in 2019, from RM5 billion in 2018. This is a commitment which it has made and will stick to even though the Malaysian Automotive Association (MAA) is forecasting the Total Industry Volume of new vehicles to grow by only 0.21% this year.

The commitment has been commended by the Perodua Vendors Club (KVP) which is a grouping of suppliers to Perodua. “This commitment will further help strengthen our position as we look forward to expand together with Perodua,” said KVP President Musa Zahidin Ahmad Zaidee.

Encik Musa said that the KVP is also appreciative of the guidance and assistance Perodua has provided over the years to its 138 members. “Among the key ways Perodua has assisted us is by providing shorter payment terms to our members who were affected by the acute reduction of local component purchases that began in 2014,” he revealed.

Some of the parts Perodua buys from companies which produce them in Malaysia.

Perodua has also improved the vendors’ financial efficiency by purchasing tooling directly from international makers, eliminating the need to acquire financing. In addition to financial assistance given by Perodua, Daihatsu Motor Company has also played a critical role in helping local vendors and has recently appointed at least two local vendors to be part of its global supply chain.

The Japanese carmaker, which is a shareholder in Perodua, has also given its commitment to continue to support the Malaysian carmaker and its local vendors as Perodua looks to the Asia-Pacific region for growth.

As a Malaysian company, Perodua has always given priority to sourcing components locally where possible. As a result, all its models have very high local content. In fact, even the latest Aruz SUV has as much as 95% of their parts coming from suppliers in Malaysia.

Part of the reason for the high percentage has been a determination to increase localisation. This has reached the extent of investing in a new engine factory and also being associated in the establishment of a transmission factory, both of which are located in Negeri Sembilan.

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[Chips Yap]

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