CNI News

20 July 2023

The car prices are greatly going up because businesspeople are buying cars without holding their money in their hands as a result of monetary inflation in Myanmar at present. 

Because the value of Myanmar currency has decreased, local businesspeople are making investments in real estate, gold market and car market. 

Of them, investment in the car market has increased rather than ever because cars can be easily sold, according to car dealers.

Some businesspeople don't want to hold Myanmar Kyat in their hands, so they have increasingly bought real estates and cars, said U Min Min Maung, chairman of Yangon Region Automobile Manufacturer and Distributor Association, to CNI News.

"The price of land is also rising greatly. Gold is a little difficult to deal with. So, cars that can be bought are bought more than they are needed. For example, if they need a car, they have bought two or three cars. If they need two, they have bought 4 or 5. In this way, car demand has become high. Also, more and more people are entering and investing in this business.That's why there is a lot of demand. If there were about 100 people doing transactions in the past, there are about 2,000 people now. But when the prices go up, they sell their cars again. So, demand is high and the prices are going up. Mainly, it's hard to say whether Myanmar currency is stable or not. The price of Myanmar currency, 1 USD is equal to around 3,000 Kyats. People who want to buy valuable items instead of keeping Myanmar money has increased. So, they invest in real estate. They buy cars." he said.

 A car sale center

Although the government cannot control the rising prices of automobiles, if the car import is re-allowed after it has been closed for over two years, car prices will go down, said car policy experts and car sellers.

It would be convenient only if the government had enough foreign currencies to manufacture locally-assembled cars, pointed out some people.Due to the current foreign currency crisis, the government will not allow the car import. So, car prices will go on rising, said U Aung Pyae Sone, car policy analyst to CNI News.

" The government needs to spend a lot of USD to import cars and to manufacture locally-assembled cars that need machine tools from abroad. But there's a question if
the Central Bank has enough foreign currency. The price of a Mark II car was about 100 million Kyats in 2008 and 2009. U Thein Sein became the president in 2010-2011 when the price was reduced to 200 lakh Kyats because the car import was permitted. At that time, a lot of foreign currencies were spent. A lot of debt from abroad was reduced. But at present, sanctions were imposed by abroad. Let alone reducing foreign debt, the government is being pressured. So, the government won't permit importing cars and manufacturing locally-assembled cars temporarily. So, car prices will be going up." he said.

Cars arriving at Myanmar port

The government has banned car import since October, 2021 for the reason why the country has needed foreign currencies reportedly.

Although there are automobiles being manufactured locally with the SKD system, because necessary parts are not allowed to import, production is slowing down. 

Only one type of EV electric vehicle is allowed to be imported at present.