Transportation Trends in Asia Driven by Automotive Changes

As a result of supply chain difficulties, Asia has struggled to produce traditional automobiles—but doing so has also brought about interesting changes.

October 2021 , by YCPS Marketing & Communication Group

Due to the global supply chain shortages because of the COVID-19 pandemic, the automotive industry’s growth in Asia has greatly suffered. As reported by Nikkei Asia and Reuters, major automobile manufacturers like Japan’s Honda were forecasted to have their domestic production reduced by 60% in August and September 2021, with numbers hopefully bouncing back later in the year.  

Meanwhile, fellow Asian countries like Thailand have also struggled with lockdown restrictions due to COVID-19. This is concerning for automobile companies, especially considering that Thailand is the fourth-largest Asian auto assembly hub in the region.



While these ongoing developments are concerning, what it has done is accelerate nontraditional ways to grow in the automotive market despite worldwide shortages. From a spike in motor vehicle purchases to a transition toward electric vehicles (EVs), the Asian region is looking to innovate, as they position themselves for promising development amid challenging times. 

An Increase in Motor Vehicles 
While the number of automobiles produced and sold continues to dip throughout Asia, the region has surprisingly seen a steady increase in production and sales of two-wheel motor vehicles.  

Data has revealed that the Philippines has managed to remain as the second-fastest developing market for two-wheel motor vehicles sold and manufactured in the ASEAN region, as per The Philippine Star. Despite the pandemic, the domestic market has produced a total of 54,551 motorcycles, which is a 39.3% increase when compared to rates from the previous year. Naturally, this growth has also manifested in total sales generated from all types of motor vehicles, with the country achieving 170,112 units sold, or a 37.8% increase. This trend has also extended to other countries within Asia as Indonesia (65.8%), Thailand (31.9%), and Vietnam (26.9%) have all registered positive motor vehicle output rates during the pandemic.  

Although countries’ respective lockdown restrictions have hindered automobile manufacturing processes, it has also brought about the need for personal vehicles, a new essential amid the pandemic. Moreover, considering that motor vehicles are a cheaper alternative to automobiles, this demand for personal transportation could very well be the main driver behind the increase in motor vehicles.  

EVs Growing in Asia 
In the YCP Solidiance white paper The Future of Mobility in China: Internet of Vehicles, research showed that China was rapidly accelerating the growth electric vehicles in their domestic automobile market, as evidenced by new energy vehicle (NEV) sales witnessing a peak increase of 62% in 2018. Furthermore, government support in the form of subsidies—which were promised until the end of 2022—would allow citizens to purchase EVs at a discounted price as reported by Automotive World.  

Other countries within Asia are also catching up, as the frequency of initiatives related to EVs is increasing across the region. Most notably, South Korea finds itself in a prominent position as the country currently accounts for approximately half of the global production for rechargeable batteries used in EVs. According to an article by the Financial Times, three South Korean manufacturers (LG Energy Solution, SK Innovation, and Samsung SDI) are responsible for 44% of the global rechargeable battery market, which is currently valued at 46 billion USD. 

Moving forward, the automotive industry will look to rebound in a post-pandemic world as automobile manufacturers aim to make up for the significant economic losses incurred. Nevertheless, even as the automotive industry is still in the recovery phase, motor vehicles and EVs should still be an area of increased interest and innovation for countries within Asia to bounce back as quickly as possible, and to set the tone for consumers in the years ahead. 

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