The robustness of the Major Domestic Appliances (MDA) industry in Southeast Asia brought in sales totaling more than USD2 billion in the first five months of 2011 – a 10 percent growth compared to the same time period last year. According to market research company GfK Asia, the six key markets of Singapore, Malaysia, Thailand, Vietnam, Indonesia and the Philippines reported over 7.2 million units of air-conditioners, refrigerators, washing machines, and microwave ovens being sold since the beginning of the year.
Except for Philippines, the rest of the five markets registered expansion in both sales volume and value of up to 27 percent, with the Indonesian and Singapore markets taking the lead in value and volume sales growth respectively.
"Interestingly, while the volume growth rate in Indonesia surpassed its value growth, the opposite has been observed in Singapore for the overall major domestic appliances sector, and greater value growth is indicative of increasing price trends," commented Jasmine Lim, regional account director for Home Appliances, GfK Asia. "In the case of Singapore, this is a telling sign of rising consumer sophistication in the market as they are more inclined to upgrade to premium products which cost more. This trend is also reflected by the 6 percent reported hike in average selling price of major domestic appliances in Singapore, as revealed in GfK’s retail audit."
Within MDA, Washing Machines are currently the main driver of the industry’s good performance, contributing over half a billion US dollars in sales to the industry. Compared to last year, considerable growth of 23 and 20 percent in value and volume sales were reported in Southeast Asia. Five out of the six markets – Indonesia, Thailand, Malaysia, Singapore and Vietnam registered strong double digits revenue growth ranging from 20 to 25 percent.
"Although single-tub continues to be the most popular washing machine type among consumers in this region, our findings show that sales of the more premium front load washer-dryer is showing considerable growth – a trend that is especially apparent in Singapore," highlighted Lim. "More consumers today are aware of the long term advantages that front loaders are able to bring, namely their energy efficiency and gentler effect on the laundry items, and recognize the value of investing in this type of high-end washing machine models."
Also observed in the MDA sector is the rising popularity of inverter air conditioners. Across the region, over a quarter (26 percent) of all air conditioners sold today has an inverter – as compared to a year ago, where the proportion was only one in five (20 percent). Growth and acceptance rate is greatest in Singapore and Philippines where unit sales have reached 67 and 40 percent respectively.
"Consumers today are well-informed and are increasingly concerned with environmental issues. In some markets such as Singapore, the government plays a major role in educating the public in this area,” said Lim. "For instance, the National Environmental Agency in Singapore implemented an energy efficiency rating, disallowing appliances that do not meet the minimum standard allowed."
"As our society progress and develop further, we can expect the continued rise in uptake of these more niche and sophisticated products that will, in time to come, capture a major share of the market," Lim concluded.