New vehicle sales in the ASEAN region’s six largest markets increased by over 40% to 834,421 units in the second quarter of 2012, from 590,529 units a year earlier, with the top two markets accounting for most of the growth.
First-half sales increased by close to 22% to 1,567,511 units, from 1,288,546 units, as governments across the region focused on driving domestic economic growth with low interest rates and other stimulus measures.
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Thailand regained its title of the region’s leading automotive market from Indonesia as its automotive industry bounced back from the devastating floods in the fourth quarter of 2011. Honda finally restarted production at its Adutthaya plant in central Thailand at the end of March, while other manufacturers were also able to ramp up production with component supplies improving.
Thai domestic vehicle demand was also lifted by flood-recovery stimulus measures put in place by the government, tax rebates for first-time buyers and a strong rebound in economic output. Pent-up demand continues to be strong after the supply constraints of 2011.
Other markets in the region also benefited from better inventory levels as a result of the recovery of Thailand’s automotive industry, with sales of pick-up trucks around the region growing particularly strongly compared with the previous quarter.
Vehicle sales in Indonesia jumped by 49% to 285,287 units in the second quarter, as domestic economic growth continued to be driven by low interest rates and high levels of investment. The government tightened lending criteria in June, so sales are expected to weaken in the second half of the year.
Malaysia reported weaker first-quarter sales after it introduced tighter lending rules and lengthier registration procedures in January, but the market seems to have adjusted already to these changes. Sales jumped by 14.5% in the second quarter.
Elsewhere in the region demand remains lacklustre, with the Philippine market struggling to make headway after peaking at over 170,000 units in 2010. Singapore sales remains restricted by government quotas because to the limited road network in the island nation, with new registrations at a decade low as government policy focuses on promoting public transport.
The new vehicle sales in Vietnam continued to suffer as a result of high interest rates and ever increasing vehicle taxation. First-half sales fell by one-third to 35,725 units.
Thailand
New vehicle sales in Thailand grew by 69.2% to 327,202 units in the second quarter, from 193,393 units in the same period of 2011, according to data released by Toyota Motor Thailand.
This sharp increase helped drive first-half sales to a new record high of 604,882 units, some 40% more than the 432,450 units sold in the equivalent period a year earlier.
The market continues to benefit from improving supplies after last year’s floods, which brought the Thai automotive industry to a standstill for over one month in the fourth quarter.
Honda Motor restarted production at its Adutthaya plant at the end of March after a five-month shut-down, allowing it to lift second-quarter sales to 45,574 units, from just 2,735 units in the first quarter.
Component shortages meant other Thai manufacturers, such as Nissan, Toyota and Ford-Mazda, were also slow to bounce back from last year’s floods.
The Thai economy has rebounded strongly this year from the sharp contraction in the fourth quarter of 2012. Second-quarter GDP growth is estimated at 4.4%, compared with just 0.3% growth in the first quarter, driven by strong domestic consumption.
Low central bank interest rates, at 3%; flood recovery stimulus policies by the government; ongoing reconstruction efforts; and the fulfilment of pent-up demand as factories restarted production; have all contributed to the acceleration in economic growth.
Full-year GDP growth is widely expected to be around 5%, with a sharp spike expected in the fourth quarter – flattered by very favourable year-on-year comparisons.
The market is well on its way to exceed 1 million units this year for the first time, as had been forecast by Toyota earlier in the year – with strong pent-up demand, a broadening range of low-cost models and first-time buyer incentives all contributing to the growth.
Indonesia
New vehicle sales in Indonesia jumped by almost 49% to 285,287 units in the second quarter of 2012, from 191,933 units a year earlier – according to data released by industry association Gaikindo.
The market continued to be driven by record low Bank Indonesia interest rates – held at 5.75% for the fifth straight month in July, strong domestic economic growth and the release of new models such as the best-selling Avanza/Xenia compact MPV range at the end of last year.
Sales in the second quarter were also lifted by improving stocks of vehicles sourced from Thailand, particularly passenger cars and pickup trucks, after the disruption caused by the floods in the fourth quarter of 2011.
The prospect of tougher lending rules also encouraged many buyers to bring purchases forward into the second quarter. Bank Indonesia now requires banks to collect minimum down-payments of between 25-30% on passenger vehicle loans.
The country’s GDP is expected to have grown by 6.5% year-on-year in the second quarter, slightly ahead of the first quarter’s 6.3% growth, with domestic consumption and investment continuing to drive the economy forward.
Second-half GDP growth is expected to be slower, with many export markets continuing to weaken and with investment growth expected to slow. Domestic consumption inevitably will be affected by tighter lending affecting mainly the housing and automotive markets.
Vehicle sales in the second half are expected to weaken as a result, as the market adjusts to the stricter lending criteria and its effects on consumer spending.
Malaysia
New vehicle sales in Malaysia rose by 14.5% to 162,680 units in the second quarter of 2012, from 142,090 units in the same period of the previous year – according to data released by the Malaysian Automotive Association (MAA).
First-half sales were just 1.4% higher at 301,224 units, with first quarter sales affected by new vehicle registration regulations, stricter lending criteria for car loans and inventory shortages due to the floods in Thailand in the fourth quarter of 2011.
The second quarter saw an improvement in vehicle supply, as well as benefiting from delayed purchases from the first quarter as the market adapted to the new regulations. Domestic consumer sentiment remains strong, helped by steady employment, a hike in public sector wages and other government initiatives. Central bank interest rates at 3% are also positive for the vehicle market.
GDP growth is estimated to have slowed to around 4.5% in the first half of the year, compared with strong growth in the year-earlier period – due mainly to a slow-down in exports.
The MAA has stood by its earlier forecast for full-year sales to rise by 2.5% to 615,000 units, which would be a new record for the market. It cited new model launches and continued positive sentiment.
The association forecasts passenger vehicle sales to rise by just 2.2% to 547,000 this year, while commercial vehicle sales are expected to expand by 4.6% to 68,000 units, with particularly strong demand for pickup trucks.
Vehicle sales in the ASEAN region by market, 2010-12
|
|
2010 |
2011 |
1-6 2011 |
1-6 2012 |
% chge |
|
800,367 |
794,091 |
432,012 |
604,882 |
40.0 |
|
|
Indonesia |
764,710 |
893,164 |
417,672 |
534,876 |
28.1 |
|
Malaysia |
605,156 |
600,123 |
297,203 |
301,224 |
1.4 |
|
Philippines |
170,216 |
162,413 |
69,782 |
72,874 |
4.4 |
|
Vietnam |
112,224 |
110,938 |
53,293 |
35,725 |
-33.0 |
|
Singapore |
47,839 |
35,904 |
18,584 |
17,930 |
-3.5 |
|
Total |
2,500,512 |
2,596,633 |
1,288,546 |
1,567,511 |
21.6 |
Sources: www.AsiaMotorBusiness.com from industry sources.
