ASEAN car sales surge on EV demand, Indonesia leads with 34% growth

Key facts

• Southeast Asia's automotive market surged in Q2 2026.
• Electric vehicle demand accelerated in Q2 2026.
• Indonesia's car sales grew by 34% in Q2 2026.
• BYD gained market share in Indonesia.
• Indonesia's economy is expected to grow 5.10% year-on-year in Q2.
• Indonesia's Q2 economic growth is a slowdown from Q1.
• Weaker consumer demand and exports impacted Indonesia's Q2 growth.
• Indonesia's IPO market is experiencing a slowdown.
• Stricter listing standards and policy uncertainty affect Indonesia's IPO market.
• Companies are delaying share sales in Indonesia.
• China's electric vehicle sales slumped in July.
• A price war is feared in China's EV market due to weakening demand.

Southeast Asia's automotive market experienced a significant boost in the second quarter of 2026, driven by accelerating electric vehicle demand. Indonesia led this growth with a remarkable 34% surge in sales, with Chinese automakers such as BYD gaining substantial market share within the region.

However, Indonesia's broader economic performance in the same quarter is expected to show a slowdown. Economists polled by Reuters anticipate a 5.10% year-on-year growth for the second quarter, a decrease from the first quarter's performance. This deceleration is attributed to weakening consumer demand and reduced support from net exports.

Further complicating Indonesia's economic landscape, the initial public offering (IPO) market is experiencing a slowdown. This stagnation is linked to stricter listing standards and ongoing policy uncertainty. Consequently, companies are delaying their share sales, even for potentially large deals, as reforms are implemented with the aim of restoring investor confidence and improving the quality of listed equities.

In a related development, China's electric vehicle market faced a significant downturn in July. Sales figures fell short of expectations, intensifying fears of a price war among manufacturers. This competitive pressure arises as companies vie for market share amidst a backdrop of weakening overall demand in the Chinese EV sector.