An Auto Show (Image Credit : RK/TheInsiderStories)

JAKARTA (TheInsiderStories) – Indonesian automotive conglomerate PT Astra International Tbk (IDX:ASII) expects the automotive market to record modest growth next year, on the back of muted economic growth.

The company projects Indonesia’s 2018 automotive sales to reach 1 million units, aligned with a 5 per cent prediction of national economic growth.

Public Relations Manager of PT Toyota Astra Motor (TAM) Rouli Sijabat said the automotive market in Indonesia will continue to grow, rising from only 155,000 units in 2003 to a peak of in 1.2 million units in 2013, marked by the introduction of Indonesia’s first ‘low-cost green car’ (LCGC).

In the ten months to October this year, TAM managed to sell 318,829 automobiles, up 3.1 per cent from the same period last year, with a 35.5 per cent market share from total national sales of 898,000 units. In the period, MPV contribution to total national sales rose from 42.3 per cent in 2016 to 44.8 per cent in 2017, due to the increasing number of new models premiered by manufacturers.

Director of PT Astra Honda Motor (AHM) David Budiono estimates that the motorcycle market in Indonesia will continue to be affected by several factors such as the impact of a torpid global economy, commodity price recovery, growth of a new middle class and export opportunity to Southeast Asian markets.

Budiono estimates that next year’s motorcycle sales are projected in a range of 5.8 to 6 million units, up from an estimated 5.8 million units this year. In 2018, AHM targets motorcycle exports to grow by 40-50 per cent from this year’s export forecast of 100,000 units.

This year alone, AHM expects to maintain its sales equal to last year’s position, in the range of 4.5 million units with the same market share as last year at 74.6 per cent.

To achieve such a sales target, he insists the company will collaborate with several parties, launching new variants and continuing to innovate.

“There are several things, including global market conditions, that will affect the sales of motorcycles in Indonesia next year. We expect to sell more than 4.5 million units with a market share of over 75 per cent,” he announced to media in Semarang, Central Java, on Wednesday (6/12).

Recently, the Association of Indonesian Automotive Industries (Gaikindo) adjusted its forecast for car sales in Indonesia for full-year 2017 downward: from a projected 1.1 million sales in Indonesia, the target has now been revised to 1.06 million units. This revision is particularly attributed to weak sales within the (lower) middle-class segment.

In the period of January to October, a total of 898,218 cars were sold in Indonesia, the largest car market in Southeast Asia. This is only a modest 2.5 per cent (y/y) increase from the sales figure for the same period one year earlier.

Jongkie Sugiarto, Chairman of Gaikindo, said the Indonesian economy has not shown a significant acceleration in 2017, and therefore consumers’ purchasing power has not improved markedly. Instead, analysts believe that Indonesians currently prefer to save their money in bank accounts.

Over the next five years, the passenger vehicle segment is projected to remain very attractive, while the growth of the commercial vehicle segment is expected to be slower, according to Frost and Sullivan, a market consultant.

Greater Jakarta will remain the key region for passenger vehicles and commercial vehicle growth, while demand for vehicles from medium and smaller-sized cities is expected to increase steadily over the next decade.


Written by Elisa Valenta, email: