Malaysia is now the second largest automotive market in Southeast Asia, overtaking Thailand and coming in just behind Indonesia, according to a report by Nikkei Asia. The report notes that the shift reflects a significant change in an area that has long been a focus of competition for Asian automakers.
The report compiles sales data from industry groups in five countries, including the Philippines and Vietnam. The data shows that Malaysia has overtaken Thailand in car sales for three consecutive quarters to January-March 2024.
The Malaysian Automotive Association reported a 5% year-on-year increase in car sales in the first quarter to 202,245 vehicles. This increase follows an 11% jump in 2023, which set a record of 799,731 vehicles.
This growth is attributed to the sales tax exemption for local vehicles under the government's economic stimulus package, which boosted sales of national car brands Perodua and Proton, which have a market share of around 60%.
A similar trend can be seen in the Philippines. The country's car sales rose 13% in the first quarter, the highest among the five countries. This came after inflation eased to around 4% at the end of 2023 and consumer spending remained strong.
In contrast, car sales in Thailand fell sharply by 25% in the first quarter compared with a year earlier. According to Nikkei Asia, monthly car sales in the country have been declining since June due to rising non-performing loans in auto financing and stagnant consumption. However, the market share of electric vehicles has increased thanks to the entry of Chinese automakers.
The other two countries experienced similar conditions. Indonesia saw a 24% year-on-year decline in car sales in the first quarter. This was due to rising interest rates, which caused consumers to postpone purchases. Meanwhile, Vietnam reported a 16% year-on-year decline in car sales in the first quarter due to declining exports and other factors.
