HONG KONG, Sept. 3, 2013
/PRNewswire/ -- Myanmar's automotive market is likely to grow at a
compound annual growth rate (CAGR) of 7.8 per cent (2013-2019), driven
by a growing economy, infrastructure development and increasing income.
Mr. Dushyant Sinha, Associate Director, Automotive Practice, Asia Pacific at Frost & Sullivan said that real growth is likely to start only after 2014.
New analysis from Frost & Sullivan (http://www.automotive.frost.com) CEO 360 Degree Perspective of the Automotive Market in Myanmar finds
that the market, currently dominated by used vehicles, is likely to
grow at a compound annual growth rate (CAGR) of 7.8 per cent (2012-2019)
to reach 95,300 units in 2019 due to greater integration with the rest
of ASEAN.
"However, factors such as unpredictable regulatory changes, high car
prices, under-developed auto service market and inadequate road
infrastructure might hinder the potential growth," he added.
He noted that after decades of military control and closed door policies, Myanmar has gradually opened up its economy to foreign trade and investment.
He added that significant developments were witnessed in 2012,
particularly the endorsement of the long anticipated foreign investment
law. Besides, the banking, finance and insurance sectors have also
undergone various reforms as a part of the government's efforts to
improve business environment.
Dushyant said that a young labor force with a high two-wheeler
ownership promises a potential car buying group in the long term.
He added that Myanmar is highly
dependent on two-wheelers, accounting for more than 80 per cent of the
market while passenger cars represent 11 per cent. Meanwhile, trucks and
buses only make up 3 per cent and 1 per cent respectively.
Dushyant also said that most parts and components are imported from China and Thailand
for assembly activities, as the few locally-produced parts available
have very low added value. He added that completely knocked-down (CKD)
parts used for assembly requires a license for import, which expires
after every 3 months.
He added that only new parts are allowed to be imported into Myanmar.
He noted that there is no restriction on imports of new parts based on
the Control of Imports and Exports Act. "Despite the import ban for used
parts, they are smuggled into Myanmar because genuine parts are highly priced and scarcely available," he added.
Dushyant said that Japanese brands are expected to continue
dominating the passenger vehicle market even in 2019, with Honda, Suzuki
and Nissan gaining popularity thanks to their small car offerings (such
as Honda Fit/Brio, Suzuki Swift, and Nissan March) which would appeal to Myanmar customers.
He added that Chinese and Korean brands will also see growth due to
their more affordable prices and smaller engine sizes compared to their
Japanese counterparts.
However, U.S. and European presence will remain at minimum level
since after sale service support, especially spare parts, are still very
limited, Dushyant said.
He said that some of the challenges faced by the Myanmar's
automotive market include an underdeveloped aftermarket sector,
inadequate road infrastructure and unpredictable regulatory changes.
If you are interested in more information on this study, please send an e-mail to Alice Chia, Corporate Communications - Asia Pacific, at alice.chia@frost.com, with your full name, company name, title, telephone number, company e-mail address, company website, city, state and country.
CEO 360 Degree Perspective of the Automotive Market in Myanmar is
part of the Automotive & Transportation Growth Partnership Services
program, which also includes research in the following markets:
Strategic Analysis of ASEAN Automotive Outlook, 2020 Vision of the
Australian Automotive Aftermarket, CEO 360 Degree Perspective of the
Automotive Industry in Myanmar,
Strategic Growth Opportunities from AEC Implementation and New
Government Policies in ASEAN, Strategic Growth Opportunities of
Navigation Systems Market in ASEAN, Analysis of the Advanced Driver
Assistance Systems Market in Japan
amongst others. All research services included in subscriptions provide
detailed market opportunities and industry trends that have been
evaluated following extensive interviews with market participants.
CEO 360 Degree Perspective of the Automotive Market in Myanmar
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Media contact:
Alice Chia
Corporate Communications – Asia Pacific
Email: alice.chia@frost.com
Twitter: @FS_Automotive
Corporate Communications – Asia Pacific
Email: alice.chia@frost.com
Twitter: @FS_Automotive
SOURCE Frost & Sullivan
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