Small Cars - Sri Lanka

Sri Lanka

Highlights

Revenue in the Small Cars market is projected to reach US$76m in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of -2.52%, resulting in a projected market volume of US$67m by 2029.
Small Cars market unit sales are expected to reach 3.8k vehicles in 2029.
The volume weighted average price of Small Cars market in 2024 is expected to amount to US$18k.
From an international perspective it is shown that the most revenue will be generated China (US$13bn in 2024).

Key regions:

Market definitionIn-Scope/Out-of-scopeMarket structureReportsMethodology

The Small Cars market in Sri Lanka is experiencing significant growth and development.

Customer preferences: Customers in Sri Lanka are increasingly opting for small cars due to their affordability and fuel efficiency. Small cars are ideal for navigating the country's narrow and congested roads, making them a popular choice among urban dwellers. Additionally, the compact size of these vehicles makes parking easier, which is a major advantage in crowded cities.

Trends in the market: One of the key trends in the Small Cars market in Sri Lanka is the growing demand for electric and hybrid vehicles. As the government promotes sustainable transportation and reduces dependence on fossil fuels, more consumers are considering eco-friendly options. This trend is further supported by the availability of charging infrastructure and government incentives for electric vehicle adoption. Another trend in the market is the increasing popularity of compact SUVs. These vehicles offer a higher seating position and better ground clearance compared to traditional small cars, making them appealing to Sri Lankan consumers who value comfort and versatility. Compact SUVs also provide ample cargo space, which is beneficial for families and individuals who require extra storage capacity.

Local special circumstances: Sri Lanka's import regulations and taxes heavily influence the Small Cars market. The government imposes high import duties on vehicles with larger engine capacities, making small cars a more affordable option for many consumers. Additionally, the country has specific emission standards and safety regulations that impact the availability and pricing of small cars.

Underlying macroeconomic factors: The growing middle class and improving purchasing power of Sri Lankan consumers are key macroeconomic factors driving the development of the Small Cars market. As more individuals enter the middle-income bracket, they have greater disposable income to spend on vehicles. The increase in car ownership is also supported by the country's stable economic growth and low inflation rate. Furthermore, the availability of financing options and attractive loan schemes provided by banks and financial institutions have made it easier for consumers to purchase small cars. This has contributed to the overall growth of the market, as more individuals can afford to buy a vehicle through affordable monthly installments. In conclusion, the Small Cars market in Sri Lanka is witnessing growth and development due to customer preferences for affordable and fuel-efficient vehicles, the increasing demand for electric and hybrid cars, and the popularity of compact SUVs. Local special circumstances such as import regulations and taxes also play a significant role in shaping the market. The underlying macroeconomic factors of a growing middle class and improved purchasing power further contribute to the market's expansion.

Data coverage:

The data encompasses B2C enterprises. Figures are based on the sales of new passenger cars. Data on the specifications of the sold vehicles is based on the base models of the respective makes.

Modeling approach:

Market sizes are determined through a bottom-up approach, building on specific predefined factors for each market segment. As a basis for evaluating markets, we use company reports and websites, vehicle registries, car dealers, and environment agencies among other sources. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP and car stock per capita. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, we use the ARIMA model for the Passenger Cars market. The main drivers are GDP per capita and consumer spending per capita.

Additional notes:

The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. The market is updated twice a year. In some cases, the data is updated on an ad hoc basis (e.g., when new, relevant data has been released or significant changes within the market have an impact on the projected development).