Hi Anonymous,

Market Sizing IS NOT about coming up with the right number, but a plausible way to A number. That way needs to be mathematically correct and based on realistic, defendable assumptions.

That being said, I believe you overestimate the number of cars per household. According to Wikipedia, Malaysia has 361 motor vehicles per 1000 people (data from 2010 though), so if your household size is correct, that would be about 1.4 motor vehicles per HH. Cars probably make up the largest part of all motor vehicles (motorcycles, which are very popular in south-east Asia are not counted in motor vehicles), so a realistic figure is maybe 1.2-1.3 cars per household. If you use 1.2 cars/hh, you end up with just under 1 mln cars per year.

(Quick googling showed me that currently there are about 70k cars being sold monthly, which is about 800k per year, which to me is pretty close to the 1 mln calculated)

But that does not really matter - your way is pretty plausible and your assumptions are not totally off the map, so you should be ok.

Cheers,

Elias

(edited)

I am not sure if this will help, but does every household buy two cars? Assuming every household is just the same might be the problem.

Plus, as you said a car has an average life of 10 years, then a small percentage of people (who bought a car 10 years back) would buy a car this year. But there are other people who don't wait till 10 years to buy a new car. Weighing them might too work.

If you want to go deeper, then you could exclude the youth that believes more in cabs (and sharing) than buying a new car.

I hope this helps.