Electric vehicle adoption
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Frost & Sullivan has issued a new report analysing the energy-efficient vehicles market in the Association of Southeast Asian Nations  (ASEAN) region.

Factors including growing domestic consumption and investments from both governments and the private sector are expected to drive the energy-efficient vehicles market in the region.

At the same time, robust GDP growth, and high population will present growth opportunities for the market.

Malaysia, Indonesia and Thailand, the region’s three big markets, are expected to reach 3.9 million units in sales of energy-efficient vehicles by 2025.

Indonesia is expected to contribute approximately 1.65 million units; Thailand, 1.54 million units; and Malaysia, 690,391 units. Thailand is forecast to register the highest growth, but Indonesia will maintain its position as the largest automotive market, while Malaysia will experience marginal growth due to its maturity.

“Indonesia will witness the launch of several SUV models and facelift variants in 2019, which will drive passenger vehicle sales due to the induced replacement of vehicles,” said Bakar Sadik Agwan, Research Analyst, Mobility, Asia Pacific at Frost & Sullivan.

“While on the one hand, the automotive market is buoyed by innovations and domestic demand, on the other, it is weighed down by a weak external sector. Furthermore, market participants need to tackle market factors such as US-China trade war escalation, the slowdown in government spending in Malaysia, high household debt in Thailand, and rising interest rates in Indonesia,” noted Agwan.

Smart mobility will be a key focus at POWERGEN INDIA and Indian Utility Week conference which takes place in New Delhi next May. For more details visit https://www.powergen-india.com/ or IUW.com

Nevertheless, automakers will be able to thrive by seizing the revenue opportunities delivered by the government as well as the market.

To achieve this, OEMs need to:

  • Leverage governments’ energy-efficient programs. The Indonesian Government has set up the LCGC program, which offers exemption or a reduction in luxury tax to low-emission cars. The Malaysian Government provides incentives and exemptions to OEMs under the energy-efficient vehicles (EEVs) program, similar to Thailand’s eco car program.
  • Alter their product line-up and adopt greener technologies to match with models in these incentive programs.
  • Localize manufacturing, without compromising on the quantity. This would help maximize benefits from government programs.
  • Collaborate with e-Hailing OEMs can also develop a mobility strategy to make the most of the growth of shared mobility solutions. This will not only help sell vehicles to shared mobility providers but also aid in marketing, increasing awareness, and rolling out test drives.
  • Invest in infrastructure and manufacturing to boost the demand for CVs, especially heavy trucks and pickups.
  • CV OEMs could launch promotional schemes and upgraded versions of popular models to attract buyers from the construction, manufacturing, and infrastructure sectors.

For more information about the report, click here.