Car Sales Overtaken by Malaysia, Not Just a Weakening of Purchasing Power

KatadataOTO – An anomaly has emerged in the Southeast Asian automotive industry. Malaysia has successfully overtaken Indonesia in new car sales.

In the second quarter of 2025, the four-wheeled vehicle market in the neighboring country showed a positive performance.

Several parties have spoken out about the situation of new car sales in the country being beaten by the neighboring nation.

"What we are witnessing is not just an ordinary domestic sales trend. This is an erosion of the fundamental competitiveness of the Indonesian automotive industry at the ASEAN regional level," said Yannes Martinus Pasaribu, an automotive expert and academic from the Bandung Institute of Technology (ITB) to KatadataOTO, Friday (08/08).

Photo : Suzuki

According to Yannes, this is quite concerning. Because the population in Malaysia is less than 15 percent of Indonesia's.

Yet, it managed to make history by surpassing Indonesia. Making it a very serious anomaly.

"This is about the industrial structure, policy direction, and the resilience of the national automotive ecosystem as a whole," Yannes continued.

He revealed that for a long time, Indonesia has relied too heavily on its massive domestic market.

However, it turned out not to be sustainable. Especially when its main foundation, the middle class in the country, is shaken.

Then, domestic manufacturers are still busy with price wars. A very unhealthy competition.

Not to mention the low commitment from new manufacturers to invest money in Indonesia.

"It could be that we have been negligent in building long-term industrial resilience," Yannes added.

With all the facts above, it is not surprising that new car sales in Indonesia continue to decline from time to time.

Even to the point of being rendered helpless by Malaysia. Thus, the situation is very concerning.

"As a result, we are not only left behind, but are now being overtaken by a neighboring country," Yannes asserted.

Photo : Special

For your information, according to data from the Association of Indonesian Automotive Industries (Gaikindo), retail sales of new cars in the first half of 2025 were only 390,467 units.

If observed in detail, the figure above dropped by 9.7 percent compared to the same period last year.

Meanwhile, looking at the factory-to-dealer shipment data (Wholesales) in the first six months of 2025, it was at the level of 374,740 units. Plummeting by about 8.6 percent compared to 2024.