Carsome Group seeks to clarify a recent news report and affirm that it has not solicited nor petitioned the Ministry of Finance for funding. It submitted a letter on 27 March 2023 in response to an engagement session with the Ministry of Finance to encourage and welcome the participation of Malaysian institutional investors in the company’s growth journey.
The Group frequently engages in discussions with various stakeholders on ecosystem building and in driving institutional engagements. As part of these routine engagements, Carsome has always championed growth for the local start-up ecosystem which can positively contribute towards the nation’s economy and enhance the nation’s digital talent pool.
It is worth noting that the Group’s liquidity position remains robust at over USD 150 million, offering the company sufficient runway beyond its break-even point, which the Group expects to achieve well ahead of its targeted deadline.
Carsome said it was among the first regional start-ups to commit to an accelerated profitability plan to prepare the Group for more disruptions and challenges in the funding markets. This approach has borne fruit, delivering operational profitability as a group whilst enabling Carsome to beat internal targets for gross margin growth and productivity improvements as of Q1 2023.
In 2022, the Group grew 250% in revenue, with the newly established retail line Carsome Certified contributing 35% of total revenue. In Q1 2023, the Group achieved its operational profitability milestone for the first time, primarily driven by a significant growth of trade margin, which doubled compared to the same period last year. Notably, more than 80% of the trade margin came from high-quality transaction margins, far ahead of most of its global peers.
Among the highlights of its ecosystem strategy, iCar Asia Group has delivered an impressive 30% year-on-year revenue growth in Q1 2023. In addition to achieving profitability on its own, the ecosystem strategy has also contributed significantly to the more than 60% reduction in Customer Acquisition Cost of the Group over the last twelve months.
With the launch of the flagship Carsome Service Centres, the Group has meaningfully integrated its products and services, from discovery to servicing, all within a single consumer app. This marks a major step in pursuing the Group’s mission: to provide its customers with peace of mind through the entire lifecycle of their ownership experience.
Today, Carsome is confidently poised for new opportunities in its markets across Malaysia, Indonesia, Thailand, and Singapore. The Group has a pipeline of growth initiatives across its ecosystem and welcomes broader institutional support.
“As we navigate a rapidly changing industry, Carsome has embraced adaptability and remained resilient. Through our commitment to operational excellence and our customer-centric approach, we are grateful to have exceeded our expectations, achieving notable growth whilst pursuing profitability. We are grateful for the Government’s support towards a homegrown brand such as ours as we scale regionally,” said Carsome’s Co-founder and Group CEO Eric Cheng.
“The Group’s internal measures for operational excellence, driven by strong capabilities in data and technology, continue to yield gross margin improvements, team productivity, marketing efficiencies, and inventory management across its markets. Coupled with this, CARSOME will take full advantage of its ecosystem strategy to redefine customer satisfaction in automotive ownership to serve its growing customer base and communities across Southeast Asia.”
As the used car industry evolves rapidly, Carsome’s market share continues to be on an uptrend across its footprint. It remains to be one of the last few larger players in the used car e-commerce space in Southeast Asia. Some of its competitors are reported to be exiting prime growth markets like Indonesia and Thailand. Other peers are pivoting into capital-intensive financing operations. Carsome’s focus remains on solving the pain points in high stake, high-complexity transactions and providing the ultimate customer experience in automotive ownership.
