Malaysia Used Car Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Malaysia Used Car Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Malaysia used car market was valued at USD 25.14 Billion in 2021, and it is expected to reach a value of USD 35.25 Billion by 2027, registering a CAGR of 5.4% during the forecast period (2022 - 2027).

COVID-19 had a significant impact on the automotive industry all over the world and Malaysia is not the exception. The used car market has seen a significant increase in sales due to factors such as a drop in income, a lack of money, and an increasing preference for private cars to maintain social distance. The used car industry emerged during the pandemic, as the new car industry suffered. The market for used cars in Malaysia is expected to witness steady growth during the forecast period.

The high urban population and spending power in Kuala Lumpur and Selangor have resulted in 60 percent of used car sales in these areas. Furthermore, several government incentives and increased preference for personal transportation during the pandemic have resulted in increased demand for used cars, rather than a decline. For example, Datuk Tony Khor Chong Boon, president of the Federation of Motor and Credit Companies Associations of Malaysia (FMCCAM), stated that 347,000 used cars were sold between January and May, 2021.

The unorganized used car sales channel and a lack of standardization might hamper Malaysia Used Car Market growth.

Key Market TrendsHatchback Segment is Expected to Hold Considerable Market Share

Malaysia's used hatchback car segment is expected to expand at a rapid pace, driven by rising demand for hatchbacks that provide flexibility when driving in tight quarters. The strong presence of leading automotive manufacturers offering a diverse range of hatchback car models is assisting in the expansion of the used car market. Market participants provide hatchback vehicles with compact designs and high rooflines. Split-folding rear seatbacks, which are usually standard on hatchbacks and increased space availability have boosted the market value of this segment.

The following are some of the most popular used hatchback cars in Malaysia:

• Perodua Myvi - Perodua Myvi is one of the best-selling cars in Malaysia. Almost every household owns at least one Myvi, and almost every Malaysian (with a driver's license) has driven one.
• Perodua Axia - The Perodua Axia is many people's first car because it is the cheapest car on the market in Malaysia. It is a low-cost, no-frills commuter that does not break the bank in terms of monthly repayment and required services. Though it is inexpensive, this model combines the best of all worlds in a small package.

Online Segment is Anticipated to Play a Significant Role in the Market

With the rapid increase in internet and smartphone penetration, a large number of consumers prefer to buy and sell cars through online auto marketplaces, and social media. The online platform has simplified the sales process and allows more parties to sell and buy cars. The supply side of this market weighs more heavily than the demand side, and transparency has altered the way and successfully turned customer intelligence to their advantage, thus also increasing future demand for used cars. Many companies are also focusing on their digital platform in order to gain a high market share in the forecast period. For instance,

• As its strategy for 2022, myTukar, Malaysia's fastest-growing digital used car platform, intends to focus on customer orientation and smoothening the used car marketplace for all users. In celebration of its 4th anniversary, and anticipating a rise in the used car market industry in the near future, myTukar is planning to launch new initiatives, campaigns, and on-ground events. myTukar has implemented a comprehensive creative rebranding strategy to better reflect its vision and future direction. Since its inception in 2018, myTukar has evolved into an online marketplace with over 4,000 sellers that offers a comprehensive range of services for all aspects of car ownership.

Competitive Landscape

The used car market in Malaysia is highly fragmented, with numerous startups and regional players. Although, in order to gain a competitive advantage, major rental companies are establishing joint ventures and partnerships to launch newer products.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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