ASEAN Light Vehicle Sales Up Slightly on ASEAN Light Vehicle Sales Q1 2019

An optimistic scenario would see Thai LV sales hit a high of 1.10 mn units this year, overtaking the Indonesian market in the process. Click to Enlarge.

During Q1 2019, ASEAN Light Vehicle (LV) sales increased by 3% year-on-year (YoY), with every market except Indonesia posting some growth in the period, according to consultancy LMC. Strong sales allowed Thailand to overtake Indonesia to become the largest LV market in the ASEAN region in Q1 2019. Number One was held by Indonesia between 2014 and 2018.

The Indonesian LV market closed the quarter with 233,000 units sold, marking a sharp 13% drop from Q1 2018, with almost every automaker declining. The best performance was recorded by Isuzu (+776 units), led by the new TRAGA Truck, which launched in Q2 last year.

LMC says that the contraction in overall demand is likely to have resulted from consumers and businesses taking a wait-and-see approach ahead of the April elections; automakers trimming deliveries to dealerships before launching several new models and new generations of popular models in the first half of this year.

Taking into account the weak Q1 performance, LMC have cut our full-year forecast for Indonesia to 1.05 mn units (-0.4% YoY), with the risk on the downside: due to a change in the oil price formula – i.e., domestic oil prices will start to rise as global prices begin to drop, which may trigger higher inflation and lower consumer spending; slow GDP growth (Q1 2019 GDP growth was slower than expected at 5.07%) and a loss of momentum in household consumption, a key economic driver.

Thailand, on the other hand, saw an increase of 11.6% YoY in Q1, with 259k units sold. This growth was driven by new model launches, including the Toyota Hilux Revo Z Edition, Toyota Camry and Mitsubishi Xpander.

This prompted LMC to review its forecast for Thai LV sales this year from 974k units in our previous report to 1.03 mn, although this is still below the 1.05 mn estimated for Indonesia this year.

The LMC forecast for Thailand remains conservative because:

  1. lingering political tensions and divisions threaten the recovery in private investment;
  2. GDP growth is expected to slow from 4.1% in 2018 to 3.4% this year;
  3. goods exports decelerated sharply in H2 2018 and declined again in Q1 2019. Indeed, the export outlook remains uncertain, due to weaker demand and increased trade protectionism in China. This is a key consideration as Thai exports of goods and services account for 77% of GDP.

The risk for the Thai LV market, however, is on the upside, driven by two key factors. Firstly, interest rates remain low. Although the Bank of Thailand (BOT) raised the official interest rate from 1.5% to 1.75% in December, the major commercial banks decided to increase the deposit interest rate but left the loan interest rate unchanged. The BOT has also hinted that it would not implement any further interest rate rises this year.

Secondly, the BOT is expected to announce new, stricter auto loan conditions in the second half of this year. As these will not be implemented until next year, however, demand is likely to be pulled ahead to 2019.

LMC Automotive is part of the LMC group. LMC is a leader in economic and business consultancy for the agribusiness sector. For further information about LMC Automotive, you can visit us at or email at




About Ken Zino

Ken Zino is an auto industry veteran with global experience in print, broadcast and electronic media. He has auto testing, marketing, public relations and communications expertise garnered while working in Asia, Europe and the U.S.
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