According to Nikkei, Malaysia has overtaken Thailand to become the second largest auto market in Southeast Asia, after Indonesia.
Southeast Asia has become an important battleground for Asian carmakers, so this is a major shift.
In collating sales data released by industry groups in Indonesia, Thailand, Malaysia, the Philippines and Vietnam, it was found that as of the first quarter of this year, Malaysia’s sales have surpassed Thailand for the third consecutive quarter.
Previously, Malaysia had long ranked third in car sales in the region.
In the first quarter of this year, car sales in Malaysia rose 5% year-on-year to 202245 units, according to the Malaysian Automobile Association (Malaysian Automotive Association).
Before that, car sales in the country rose 11 per cent to a record high of 799731 in 2023.
The exemption from sales tax on domestic cars as part of the Malaysian government’s economic stimulus package provides an advantage for state-owned car brands Perodua and Proton, which have a market share of about 60 per cent.
According to the Malaysian Automobile Association, the tax exemption policy began in 2020 during the epidemic and stopped in mid-2022, but delayed delivery of duty-free orders continued to drive sales growth in 2023.
“the launch of many new models, including electric vehicles at very competitive prices, has helped to boost sales,” the association said in a statement.
” Ivan Khoo, Toyota’s sales agent in Kuala Lumpur, told Nikkei that sales in the first two months of 2024 were better than expected and that the Vios was the most popular model because its price was less than 100000 ringgit ($21000).
“I think Toyota’s internal combustion engine and hybrid models will continue to perform well,” Khoo said.
” The Malaysian Automobile Association predicts that total car sales in the country will fall by 7.
5% this year, but sales of hybrid and pure electric vehicles are expected to grow.
“Consumer spending is likely to slow because of concerns about the high cost of living, the implementation of high-value goods taxes and higher service taxes on services such as vehicle repair and maintenance,” the association said.
” Nikkei, by contrast, car sales in Thailand, which has long been called “Detroit in Asia”, remain in the doldrums.
In the first quarter of this year, car sales in the country fell 25 per cent from a year earlier, after Thailand ranked second in Southeast Asia.
Since June last year, Thailand’s monthly car sales have declined compared with the same period last year due to the increase in non-performing car loans and the stagnation of overall consumption.
The share of electric vehicles is growing as a result of the entry of Chinese manufacturers.
The Indonesian market also lacks momentum.
The rise in interest rates has reduced consumers’ desire to buy, so car sales in the country fell 24% in the first quarter from a year earlier.
In 2023, car sales in the country were slightly more than 1 million, down 4 per cent from 2022 and 30,000 fewer than in 2019 before the outbreak, and failed to meet the Indonesian Association of Automobile Manufacturers'(Gaikindo) target of 1.
05 million.
In the first quarter of this year, car sales in Vietnam fell by 16%.
Since last year, Vietnam’s domestic economy has been stagnant due to sluggish exports and other reasons, and car sales have fallen by double digits compared with the previous year.
Domestic car demand in Vietnam surged before the domestic car registration fee waiver expired in December, but sales returned to a year-on-year decline in January and February.
Meanwhile, car sales in the Philippines rose 13% in the first quarter from a year earlier, the highest increase among the five countries.
Previously, inflation in the Philippines fell to about 4 per cent at the end of 2023, and consumer spending remained strong.
With the growing middle class in Southeast Asian countries, automakers from China, Japan, South Korea and other countries are engaged in increasingly fierce competition in the region, according to Nikkei.
Subsidies and macroeconomic conditions are expected to be key factors affecting car sales in the region.
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