The ASEAN light vehicle (LV) market experienced a marginal increase of 1% YoY from January to August. However, August sales dropped by 3% YoY for the second consecutive month due to the declining sales trends in Indonesia and the Philippines.
In Indonesia, LV sales fell by 19% YoY in August and continued to decline by 15% YoY in September, marking the fifth consecutive month of double-digit declines. Consequently, the LV market decreased by 10% YoY from January to August, with positive growth only recorded in February (+3% YoY) and April (+10% YoY) due to low sales volumes last year. The poor sales performance this year can be attributed to tightened auto loans, a weak economy, and low purchasing power. According to Bank Indonesia’s monthly survey, the consumer confidence index for September reached its lowest level since April 2022. It is important to note that domestic consumption is one of the key economic drivers in Indonesia. Additionally, nationwide protests at the end of August and early September contributed to political uncertainty.
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Due to negative economic indicators, political uncertainty, and the declining sales trend, the sales outlook for Indonesia has been revised downwards by 2% for 2025 and an average of 8% for the 2026–2032 period. As a result, Indonesia’s LV sales are projected to drop by 12% YoY to 704k units in 2025 and are not expected to return to the 1.0 million unit level until 2033. However, the automotive association GAIKINDO has requested the government to reintroduce tax cuts to stimulate LV sales by lowering taxes. We will monitor this development closely, as this policy successfully boosted sales during 2021–2022.
In the Philippines, LV sales declined by 9% YoY and 7% MoM in August due to fewer working days, natural disasters including typhoons and flooding, the ghost month festival, and price hikes for pickups. The government canceled the tax exemption on pickups to increase revenue under the Capital Market Efficiency Promotion Act (CMEPA). Consequently, the tax rate on pickups is now subject to a range of 4% to 50%, depending on the price. It is important to note that the pickup segment contributed approximately 13% of total LV sales in the Philippines this year.
Despite the Philippines LV market still increasing by 3% YoY from January to August, this growth rate has decelerated from 11% in Q1 2025 and 5% in H1 2025. The declining sales trend has led us to lower the Philippines LV sales outlook by an average of 4% compared to our previous report, now projected at 476k units (+1% YoY) in 2025. Furthermore, economic conditions and LV demand could be negatively impacted by recent anti-corruption protests and weak investment.
In contrast, Malaysia’s LV sales grew by 2% YoY in September, marking the second consecutive month of growth. The positive results in August and September were largely driven by the refreshed Proton X50. For the outlook, we have increased the 2025 sales forecast to 804k units due to a) the government’s confirmation not to extend the tax exemption for imported BEVs, which is set to end in December 2025, and b) the expectation of price hikes for locally built models under the new tax calculation methodology known as open market value (OMV) in 2026. Another key development in this report is the government’s announcement of a scrapping car program under Budget 2026. Briefly, vehicles eligible for scrapping must be over 20 years old, with an incentive amount of up to MYR 4k. The qualified new car models are from national brands, Perodua and Proton. We expect that this policy will not impact the overall market forecast, but it may distort the market by shifting demand from non-national brands to national brands.
Thailand’s LV sales increased by 4% YoY in August 2025, marking the fourth consecutive month of growth. Cumulatively, sales for the first eight months of the year have risen by 1% YoY. The positive momentum was driven by robust demand for passenger vehicles (PVs), which experienced an impressive growth rate of 8% YoY. This resurgence can be largely attributed to the competitive pricing strategies adopted by Chinese automakers. Due to strong passenger vehicle sales from May to August, we have increased our forecasts for the Thailand LV market to 585k units (+3% YoY) in 2025.
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By GlobalDataIn August 2025, Vietnam’s LV sales rose by 17% YoY, following a 16% YoY increase in July. Year-to-date, LV sales have surged nearly 34%, driven by strong performances in both PV and LCV (Light Commercial Vehicle) segments. As the market enters Q4, historically a peak season due to pre-Tet holiday demand, buyers are seeing significant discounts and promotions. However, growth rates may slow in the coming months due to a high base effect from the 50% registration fee reduction for domestically manufactured vehicles, which was in effect from September 1 to November 30, 2024. On a positive note, the government has introduced a 30% reduction in new car registration fees, effective September 3, 2025, to sustain demand while promoting the transition to greener vehicles. For the full year, projections indicate that Vietnam’s LV sales will reach a record high of 521k units (+12% YoY).
In conclusion, the ASEAN LV market remains unchanged at 3.1 million units in 2025 but has been revised downwards by an average of 3% for the 2026–2032 period due to the downward sales revisions for Indonesia and the Philippines.
This article was first published on GlobalData’s dedicated research platform, the Automotive Intelligence Center.
