How Is The Malaysia Used Car Market Positioned?
Overview: The Used car market in Malaysia is quite fragmented amongst the unorganized players in the industry. The used to new car ratio has been increasing over time and is currently at 0.8:1. Increasing demand for private vehicles, increasing purchasing power, easy availability of finance, increased govt. incentives to ensure sale of new cars are the main reasons behind positive growth in used car revenue. Other major drivers include increased internet and smartphone penetration and emergence of online players which have made the overall process of selling and buying used cars smooth, thus boosting sales.
The buying decision of the customers is influenced by key parameters such as Price, Model and Brand value. Home grown brands Proton & Perodua account for majority of the market share.
Market: Market for used car in Malaysia has enhanced by a CAGR of ~% over the period 2015-2020 on the basis of revenue. Sales for used cars were recorded at ~ units in Malaysia during 2020.
Increasing demand for quality cars, warranty packages, post-sale services, easy financing are the main reasons behind positive growth in the sales of OEMs dealerships. However, independent dealers dominate the market as they offer cheaper price as compared to OEMs and Multi-brand Showrooms.
The demand for used cars decreased during the peak of pandemic on account of MCO restrictions. This was due to low supply and closure of OEM dealerships and Local Tents during lockdown. However, as the country witnessed easing of lockdown restrictions, there was a significant traction in used car sales fueled by changing consumer preferences. Going forward, the manufacturers are expected to shift focus towards digital medium in order to drive sales and increase customer footfall.
Malaysia Used Car Market Segmentation
By Sales channel: B2C/OEM dominates the market both in terms of both volume and value due to the provision of value-added services and after sales services. C2C transactions occurring between friends and family are comparatively very less.
By Source of lead generation:
In Malaysia, Online platform is the most preferred method for lead generation for organized players as it eliminates middlemen and the commission margin associated with them. It also offers a display of large variety of used vehicles on a single click and allows person to compare different vehicles at the same time.
By Type of Car: Sedans are the most popular car types in Malaysia. This is majorly due to the fact that they have both commercial and personal utility, mostly finding applications by young professionals, store/business heads, on- demand services like taxi and rental services
By Price: The price range of MYR 30,000-50,000 accounted for highest percentage share of used cars in Malaysia in 2020. Sedans and Hatchback are the most popular car models preferred by Malaysians, and a vast majority of them lie in this price range.
By Brand: Perodua is the market leader in Malaysia accounting for greater than 30% of sale of used cars by volume. Cars of Perodua, Proton, Toyota, Honda, Nissan are the most preferred due to strong brand value, reliability, longer life span, and higher retention value of the used vehicles
By Kilometers Driven: Cars with running of 80,000- 120,000 kilometers dominate the market. Vehicles used for commercial purposes such as taxis, rentals travel in excess of 40,000 kms every year.
By Ownership Period: Cars with ownership period of 5-8 years have the highest market share owing to high durability of the pickup trucks in the country. Since these vehicles have sturdy engines, the owners tend to keep them for long time and use it for business purposes.
By Region: High urban population and disposable income in Kuala Lumpur & Selengor has led to generation of ~% of the used car sales over these regions. Due to geographical factors, East Malaysia has a high demand on pickup trucks. East Malaysian cities such as Sabah, Kuching have sales generated majorly by pickup trucks that provide better power and maneuverability, especially for off road commercial applications such as logging, construction, and plantation.
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Snapshot On Online Used Car Landscape
The online used car market has been emerging with the rise in the popularity of e-commerce platforms in the country. The growth of online advertising, which has fueled the rise of online classified platforms that have revolutionized the way in which pre-owned vehicles have been sold in the country. With the growth in the number of vehicles sold online, these players not only witnessed a sharp growth in marketplace revenue but also from other sources including advertisements, subscriptions and other value-added services. Some of the largest players in the space follow a complete transaction marketplace model that provide consumers a completely digital experience and enable them to book test drive & buy used cars online. These platforms also provide ancillary services such as insurance, warranty, financing options & documentation support. They are expected to demonstrate a ~% CAGR till 2025 on account of growth in the online segment due to rapid internet penetration and increase in transaction volume due to preference of owning personal vehicles, mainly due to Covid-19.
Competition Scenario In Malaysia Used Car Market
There exists Intense competition in the highly fragmented market with various OEM certified, brand authorized dealerships, multi-brand outlets & independent (standalone as well as clustered dealers) operating in the industry. Used Car Market in Malaysia has been dominated by B2C and OEM Dealerships which has captured majority share in the sales volume of used cars during 2020. Price, age, residual value of the vehicle, brand value, maintenance required are some of the most important factors impacting the preference of consumer. The players compete on parameters such as Product Portfolio, Distribution Network, Pricing, Discounts, and Geographical Location, Value Added Services, Collaborations & Partnerships and After Sales Service.
Malaysia Used Car Market Future Outlook and Projections
The used car industry is expected to demonstrate strong demand arising due to preference of personal vehicles over public transportation, mainly on account of Covid-19 pandemic. The strong pent-up demand in used car sales as witnessed in 2021 will drop slightly in 2022 on account of reduced govt. incentives and the volume will normalize. The sales of economical cars are also expected to increase over the forecast period. Use of advanced technologies such as AI to valuate car online by looking at the pictures only, 360-degree view of the interiors of the car, etc. to enhance digital experience of consumers. FMCCAM is planning to introduce new online marketplace and look for used car financiers from Japan, China and Taiwan so as to increase used car sales.
Key Segments Covered: –
- By Market Structure
- Organized
- Unorganized
- By Sales Channel
- B2C/OEM organized
- C2C
- Auction
- By Source of Lead generation
- Online
- Dealership walk-ins
- By Car Segment
- Sedan
- Hatchback
- SUV
- MPV
- Pickup trucks
- Others (convertibles, coupe, sports vehicles, etc)
- By Price
- Less than MYR 30,000
- MYR 30,000-50,000
- MYR 50,000-70,000
- MYR 70,000-90,000
- More than 90,000
- By Brand
- Perodua
- Proton
- Honda
- Toyota
- Nissan
- Others (Mitsubishi, Mazda, Mercedes, Audi, etc)
- By Region
- Kuala Lumpur
- Selengor
- Johor
- Penang
- Perak
- Others
- By Ownership period
- Less than 2 years
- 2-4 years
- 4-6 years
- 6-8 years
- More than 8 years
- By Mileage
- Less than 20,000
- 20,000-50,000
- 50,000-80,000
- 80,000-120,000
- Above 120,000
- By Fuel
- Petrol
- Diesel
- Hybrid
- Electric
Companies Covered: –
OEM Dealerships
- Perodua Pre-owned
- Proton Certified Pre-owned
- Toyota Topmark
- Mazda Certified Pre-owned
- BMW Premium Selection
- Mercedes Benz Certified Pre-owned
Online Portals – C2B platforms
- Carsome
- MyTukar
- MyMotor
Online Portals – Online Auto Classified Platforms
- my
- Motor Trader
- my
- WeMotor
- Motor Trader
- Autocari
- my
B2B Auction players
- G-Mart
- MUV
- NG Chan Mau & Company
- Pickles Auction
Key Target Audience
- Used Car Companies
- OEMs
- Online Used Car Portals
- Auction players
- Used Car Financing Companies
- Government Bodies
- Investors & Venture Capital Firms
- Used Car Dealerships
- Used Car Distributors Auction Houses
- Used Car Associations
Time Period Captured in the Report: –
- Historical Period– 2015-2020
- Forecast Period– 2021-2025
Key Topics Covered in the Report
- Executive Summary
- Research Methodology
- Malaysia Used Car Market Overview
- Malaysia Used Car Market Size, 2015-2020
- Malaysia Used Car Market Segmentation, 2020
- Growth Drivers in Malaysia Used Car Market
- Issues and Challenges in Malaysia Used Car Market
- Regulatory Framework
- Ecosystem and Value Chain of Used Car Industry in Malaysia
- Customers Purchase Decision Making Parameters
- Cross Comparison between Major OEMs and Multi-brand Dealers and Company Profiles & Product Portfolios
- Snapshot on Online used car market
- Snapshot on C2B and online classified market
- Snapshot on Auction Market
- Future Market Size and Segmentations, 2021-2025F
- Covid-19 Impact on the Industry & the way forward
- Analysts’ Recommendations
For More Information on the research report, refer to below link: –
Malaysia Used Car Market Sales Revenue Growth
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