Demand for SUVs Strong in Asia

4 July 2005

Gulf Times. Despite rising oil prices, sales of SUVs remain strong across the Asia-Pacific region.

Manufacturers and industry analysts say most SUVs now sold in the region are mid-priced, passenger car-based models produced by Asian companies such as Toyota, Nissan, Mitsubishi, Isuzu, Suzuki, Subaru, KIA and Hyundai.

Auto industry expert Graeme Maxton, a director of research firm Economist Intelligence Unit based in Hong Kong, does not expect $60 crude and the resulting higher pump prices to have an immediate impact on Asian SUV sales.

Higher fuel prices are going to lead to more inflation and less investment “rather than a major change in the makeup of vehicle sales”, he said.

“Looking two or three years out, there is an incentive for governments to begin to push small vehicle sales,” he said. “When you get tax incentives and penalties for gas guzzlers, then perhaps the market will shift.”

[...] A spokesman for the Japan Automobile Dealers Association said that unlike models produced 10 years ago, “the current models of SUVs have become very fuel efficient.”.

“We have yet to compile sales data on SUVs for June but we can say the sales figures will not be affected by oil prices,” the spokesman said.

In May, 15,232 units of SUVs were sold, up 24.8% from April. On a year-on-year basis, the May sales surged 47.3%.