After ASEAN Light Vehicle (LV) sales dropped for 2 consecutive years in 2023 (-1% year-on-year (YoY) and 2024 (-5% YoY), the downward trend continued in January 2025 with a decline of 8% YoY, on account of weak performances within the region’s three largest markets: -11% YoY in Indonesia, -10% YoY in Thailand, and -24% YoY in Malaysia. In contrast, LV volumes in Vietnam and the Philippines increased by 22% YoY and 11% YoY, respectively.
In Vietnam, the outstanding sales performance was on account of the low base in January 2024 and robust economic growth. GDP growth reached 7.6% YoY in Q4 and seven.1% for full-year 2024, driven by exports, manufacturing, and foreign investment inflows. The tourism sector rebounded strongly, too, with the variety of foreign visitors returning to pre-pandemic levels. On the domestic front, the property sector is constant to get well from the bursting of the bubble in 2023.
A key development for the Vietnamese market is that the federal government enacted Decree No. 51/2025/ND-CP on March 1, 2025, which stipulates that it should proceed to waive registration fees for Battery Electric Vehicles (BEVs) until February 28, 2027. This initiative is meant to motivate more consumers to contemplate purchasing Electric Vehicles (EVs) and is prone to be helpful to VinFast, a Vietnamese EV manufacturer. It’s noteworthy that in Vietnam, the registration fee represents a good portion of the associated fee when buying a vehicle, with the share various by location and vehicle type.
For the Philippines, the double-digit growth was supported by reasonably priced Chinese models and robust remittance inflows from overseas Filipino staff (OFW). Based on media reports, remittance inflows increased by 3% YoY and hit an all-time high of $34.5 billion in 2024. Note that remittance inflows from OFW accounted for 8.3% of the Philippines’ GDP in 2023. Despite these developments, no significant changes have been made to the country’s sales outlook.
As well as, each positive and negative aspects proceed to play a task within the Philippines’ LV market. On the positive side, the federal government is preparing a latest automotive policy called Revitalizing the Automotive Industry for Competitiveness Enhancement (RACE), the complete details of which will likely be officially announced in March or April. On the negative side, the economy and LV demand may very well be hurt by political instability after former President Duterte was arrested for crimes against humanity during his drug war period.
Looking forward to February, our recent data indicated that Indonesian and Malaysian sales increased by 3% YoY and a pair of% YoY, respectively. The advance in Indonesia was mainly supported by the 2025 Indonesia International Motor Show event from February 13-23. For the Malaysian market, Perodua and Chery Group were the fundamental growth drivers, due to solid demand for the Myvi and Bezza from Perodua, and the newly launched Jaecoo J7 from Chery Group.