LOCAL REPORT ASEAN Vera Sandarova, Marketing Manager, Kline

The future of lubricants consumption in diverse but unequivocally fast-paced ASEAN markets differs across regions of the Association of Southeast Asian Nations (ASEAN).

In comparison to western countries, consumers of lubricant products in the ASEAN region (comprised of Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam) are price-sensitive, and low-quality lubricants are still significantly used. As most people follow a do-it-for-me approach for maintenance in ASEAN, installed channels account for the dominant share in the consumer automotive lubricants segment.

The main lubricants consumed in ASEAN countries are heavy-duty motor oil (HDMO), passenger car motor oil (PCMO), and motorcycle oil (MCO). The ASEAN region is not as industrialised as western countries; hence, industrial lubricants have a smaller share compared to automotive lubricants.

The region has a sizable two-wheeler population; however, the size of the two-wheeler population differs from one market to another. For example, while Indonesia is the second-largest two-wheeler lubricants market globally, the two-wheeler parc in Malaysia is smaller than its passenger car parc.

Indonesia is the largest lubricants-consuming country, accounting for about one-third of total lubricants demand among ASEAN countries. This demand is positively impacted by the economic stimulus provided by the government, which includes key infrastructure projects such as developing new highways and steel and power generation plants.

Thailand follows in second position, with a share of slightly more than one-fifth of overall regional demand. Thailand’s lubricants market is competitive, with the presence of approximately 150 to 170 brands. Thailand is the largest automotive producer in ASEAN.

About 91% of Vietnam’s vehicle population is two-wheelers; however, demand for new motorcycles is


gradually reaching saturation levels due to the existing motorcycle parc and competition from passenger vehicles. Its passenger vehicles market is relatively small but the fastest growing in Southeast Asia.

In the Philippines, “Jeepneys” are an important means of public transportation and consume a large amount of monograde HDMO. The combination of the Public Utility Vehicle Modernisation Program (PUVMP) program, which mandates the phasing out of “Jeepneys” and buses aged 15+ years, plus the trend toward the switch to EVs, will have an impact on volumetric lube demand and lube quality in the market.

Myanmar has a low vehicle ownership rate. The introduction of the auto import policy, allowing to import only left-hand drive vehicles manufactured in or after 2015 into the country, would result in a slow shift toward the comparatively newer vehicles in the short run. Thus, flat demand for 10W-30, 5W-30, and other 5Ws and 0Ws through 2024 can be foreseen.

Poor quality of transportation network infrastructure is a major deterrent for improving passenger vehicle sales in Cambodia. As the majority of the commercial automotive parc and passenger car parc comprises secondhand vehicles, the quality of lubricants used in Cambodia is low.

While Singapore is one of the most important lubricants-consuming markets in ASEAN, it is skewed toward marine lubricants demand. More than 90% of the country’s lubricant demand is accounted for by the industrial sector due to a well-established marine industry.

Government regulations and policies, COVID-19 impact in the short term, consumer purchasing power, government spending on key industries, and international trade and commodity prices are some of the key factors that can impact ASEAN lubricants market in the near future.


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