Malaysia Is the Second-Largest Automobile Market in ASEAN, Surpassing Thailand
Move over, Thailand. Malaysia is now the second-largest automobile market in Southeast Asia. Indonesia is still leading the way, although this new achievement marks a significant shift in the region.
Malaysia’s automobile sales figures have surpassed Thailand’s for three consecutive quarters (January to March 2024). Malaysia’s Automotive Association says they experienced a 5% rise in car sales within the first quarter of this year alone, a significant improvement from the previous year. This puts Malaysia’s first-quarter total sales at 202,245.
Boosted by Stimulus Measures
Sales tax exemptions are among the factors that significantly boosted car sales, especially for national brands like Perodua and Proton (60% of the market share). Tax exemptions were first introduced in 2020 during the COVID-19 pandemic and ended mid-2022. Currently, pre-existing tax-free bookings are being fulfilled, and these continued to boost sales in 2023.
Other factors that helped boost sales included competitively priced electric vehicles and the launch of new car models. In the first two months of 2024 alone, sales in Malaysia’s automobile market exceeded expectations. The Toyota Vios (below RM100,000) proved to be the most popular model. Toyota is expecting the hybrid models to continue doing well too.
Other Markets in Southeast Asia
While Malaysia’s automobile market looks promising, other markets like Indonesia, Vietnam, the Philippines, Japan, China, and South Korea paint a different picture. Indonesia’s sales were on the decline because of rising interest rates, which deterred customers from buying cars.
Vietnam’s sales were lower due to the sluggish economy and weak exports. The Philippines, however, saw a 13% increase in auto sales for the first quarter since inflation eased to 4% in late 2023. Meanwhile, Japan, South Korea, and China’s carmakers are looking to intensify their competition with the middle-class growing and more government subsidies on the horizon.
Looking to Venture into Malaysia?
With increasing purchasing power and development, the demand for automobiles is still on the rise in Malaysia. If you’re looking to venture into this sector, you can contact 3E Accounting. We can help you with company incorporation, business advisory and more.
