KUALA LUMPUR: Sales at Tan Chong Motor Holdings Bhd are expected to remain under pressure this year as competition from Chinese marques intensifies, said RHB Investment Bank Bhd (RHB Research).

Nissan's market share fell to 0.8 per cent in 2025 compared with one per cent in 2024. Tan Chong is the sole distributor of Nissan in Malaysia.

In the absence of a clear recovery strategy, RHB Research said it remains cautious about the group's prospects for a near-term turnaround.

"On the electric vehicle (EV) front, we are positive on Tan Chong's letter of intent with Perodua to lease part of its Serendah assembly lines (30,000 units per year) for QV-E.

"As Tan Chong retains its traditional automotive model of owning the production lines, this may help to better manage its fixed costs by optimising capacity," said RHB Research in a note.

The firm estimates utilisation rates to decline to 10 per cent in 2025 from 12 per cent in 2024.

Tan Chong introduced its completely knocked down Wuling Bingo EV in mid-December, priced between RM68,000 and RM73,000.

Booking visibility remains limited, with Road Transport Department data showing just 35 units registered in January, likely due to intense competition in the sub-RM100,000 segment, particularly from Proton e.MAS 5.

RHB Research cut its financial years 2026 and 2027 earnings forecasts for Tan Chong by 14.5 per cent and seven per cent, respectively, to factor in higher operating expenses.

The firm maintained its "buy" recommendation on the stock but trimmed its target price to 90 sen from RM1.08.