Published on June 8th, 2023 | by Subhash Nair0
Car Prices On The Rise Across The Board In Malaysia
The Hyundai Creta came in at just below RM150,000 because that’s just the reality of car prices in 2023.
It’s no secret that car prices are increasing, but sometimes the effect can be lost on us. When the Hyundai Creta was launched in Malaysia just a few weeks ago, many balked at the prospect of paying RM150,000 for a B-segment crossover. After all, the Hyundai Kona, another B-segment crossover, is available for as low as RM124,188 with a 2.0L engine.
However, it’s becoming clear that the Creta’s pricing reflects changes occurring industry-wide with all new cars, including those that will be locally-assembled.
We saw hints of this with the launch of the all-new Toyota Vios. This entry-level B-segment sedan came with pricing starting at about RM75,000 in 2020. For the 2023 model, the most affordable version of the Vios is now about RM90,000 – that’s an increase of 20% in less than 3 years!
We have also seen this trend reflected in the premium compact crossover segment over a longer period of time. The all-new Mercedes-Benz GLC 300 was launched this year with a price tag of RM429,888. The GLC 300 it replaced was selling for under RM340,000. Even when factoring in local assembly tax advantages, the price hike of RM90,000 in just a few short years is a tough pill to swallow.
Both of these examples demonstrate what is happening at two different extremes, but they reflect a trend with all new cars introduced in 2023. Car prices are rising substantially, regardless of the brand’s country of origin, local assembly, body style, or market positioning. Later in the year, we can expect many other familiar nameplates to be updated with higher pricing.
What exactly is triggering these changes in pricing? It’s a mix of factors. The Malaysian Automotive Association warned last year that 2023 would see an increase in car prices between 8% to 20%, but that was in regards to CKD vehicles. Globally, the semiconductor shortage has eased somewhat, but now inflation has become a major problem. The cost of materials, energy, and labor has all gone up by a substantial amount.
With that in mind, it’s a lot easier to understand why the fully-imported Hyundai Creta feels aptly priced at just under RM150,000. It’s the first of many vehicles to usher in a ‘new normal’ in vehicle pricing here.