Report: Malaysia Takes Lead in Southeast Asia’s Auto Market

Malaysia has officially overtaken Indonesia in quarterly car sales for the first time, a significant milestone that signals a changing tide in Southeast Asia’s auto market.

According to a recent report by Nikkei Asia, Malaysia registered 183,366 new vehicle sales between April and June 2025. While that figure is slightly lower than the same period last year, it was still enough to top Indonesia’s total of 169,578 units, which fell 12% year-on-year.

It’s a remarkable shift. Just over a year ago, Malaysia trailed Indonesia by nearly 90,000 vehicles. By mid-2024, it had already passed Thailand to become the second-largest car market in the region. Now, it’s moved ahead of Indonesia as well.

Several factors are fueling Malaysia’s rise. Despite some cooling in overall vehicle demand this year, local buying sentiment has remained upbeat. Inflation is stable at around 2%, the ringgit has strengthened slightly, and Bank Negara’s decision to cut the OPR to 2.75% has made financing a bit more accessible. 

The country also posted a healthy GDP growth rate of 5.9% in the first half of 2025.

Local brands are still leading the charge. Perodua and Proton continued to dominate, accounting for 63% of total sales; that's 235,961 vehicles shifted in the first half of the year. Perodua remains a household name for its affordability, reliability, and ever-improving lineup, while Proton benefits from strong SUV offerings and renewed brand strength.

The latest data from the Malaysian Automotive Association (MAA) shows that total industry volume for 1H 2025 stood at 376,636 units, down 4.6% from the same period in 2024. That drop reflects a high base from last year’s record-setting total, along with a slowdown in pick-up and commercial vehicle sales, especially after the diesel subsidy was removed in June.

What’s holding up well, however, is Malaysia’s growing appetite for electrified vehicles. EV sales in the first half of 2025 reached 12,733 units, up 91% from the same period last year. Hybrid sales also rose by 12% to 17,480 units. 

While MAA does not provide official model breakdown, numbers from data.gov.my indicates Proton e.MAS and BYD leading in the EV space while Toyota and GWM in hybrids — a trend consistent from previous quarters.

In contrast, Indonesia’s auto sector continues to struggle. The sharp decline in sales reflects weak consumer confidence and tighter loan conditions. In June 2025 alone, car sales fell 21% year-on-year, the worst monthly drop in over a year.

Against this regional backdrop, Malaysia’s steady consumer demand, strong national brands, and accelerating EV uptake are putting it on a very different trajectory. For years, Indonesia has been the region’s automotive leader, but the numbers now show Malaysia pulling ahead.

Source: IDN Financials