Despite the country's high import tariffs and the high luxury goods tax, there remains strong demand for imports of completely built up (CBU) cars in Indonesia. As the Indonesian government is eager to limit imports of consumer goods, it set an average import tariff of 45 percent on CBU cars. Besides this import tariff the imported CBU car is also subject to Indonesia's luxury goods tax at 20 percent. However, these high taxes have done little to curtail imports of CBU cars. The real reason why some foreign-branded imported CBU cars see declining sales in Indonesia is due to weaker purchasing power.

Lanjut baca ›

Although it was no surprise to hear that American car manufacturer Ford Motor Company decided to exit Japan, few expected the car giant to leave Indonesia. On Monday (25/01), Ford Motor Company announced it will have closed its sales operations in Indonesia and Japan by the end of 2016. This decision came nearly one year after American multinational corporation General Motors Company (GM) decided to shut down its Chevrolet Spin production plant in Indonesia. Why do major American (and European) car manufacturers have difficulty to tap the Indonesian car market?

Lanjut baca ›

Sesuai dengan prediksi dan kecenderungan umum sepanjang tahun ini, penjualan mobil Indonesia turun 4,4% menjadi 87.311 unit pada bulan November 2015. Pada periode Januari-November 2015, total penjualan mobil di negara itu mencapai 940.317 unit, turun 16,7% dari penjualan mobil di periode yang sama tahun lalu. Penyebab utama dari performa yang lemah ini adalah melemahnya daya beli masyarakat Indonesia akibat perlambatan ekonomi negara ini, inflasi yang tinggi (dalam tiga kuartal pertama tahun ini), dan harga komoditi yang rendah.

Lanjut baca ›

New York-based Fitch Ratings, one of the three major global credit rating agencies, expects demand growth in Indonesia's life and non-life insurance sectors to occur over the medium term on the country's (currently still) low insurance penetration rate, improving risk awareness, and the expanding middle class segment within the rising population of Southeast Asia's largest economy. Meanwhile, the credit rating agency believes Indonesia's car and motorcycle sales will remain under pressure in 2016 due to weak consumer spending.

Lanjut baca ›

Production of cars in Indonesia is expected to decline 15 percent (y/y) to an estimated 1.1 million vehicles in 2015, far below the target (1.6 million vehicles) set in the automotive industry roadmap desinged by the Indonesian Industry Ministry. This drop is due to the slowdown in car sales in Southeast Asia's largest economy. Slowing economic growth, which dragged down Indonesia's gross domestic product (GDP) growth to a six-year low, resulted in weakening purchasing power of Indonesian consumers.

Lanjut baca ›

Third-quarter corporate earnings of Astra International, one of Indonesia's largest diversified conglomerates, cause concern that economic growth of Indonesia has continued to slow in Q3-2015. Corporate earnings of Astra International are a solid indicator of the country's total growth as the company is engaged in basically all key sectors of the economy. Astra reported a 17.2 percent decline (year-on-year) in net profit to IDR 12 trillion (approx. USD $888 million). Sales fell 8 percent (y/y) to IDR 138 trillion.

Lanjut baca ›

On 11 October 2015, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website in the last seven days. Most of the topics involve economic subjects such as the government's third stimulus package, the remarkable performance of Indonesian stocks and the rupiah, growth forecasts from the World Bank and the IMF, Indonesian car sales, a palm oil industry update, and more.

Lanjut baca ›

Car sales in Indonesia continued to decline in September 2015. Based on the latest data from the Indonesian Automotive Industry Association (Gaikindo), a total of 92,478 vehicles were sold in Southeast Asia's largest economy in September, down 9.8 percent from sales in the same month last year. Indonesian car sales have been slowing since the all-time sales peak in 2013 amid the country's easing economic growth pace (triggering weaker purchasing power).

Lanjut baca ›

Despite the hosting of the Gaikindo Indonesia International Auto Show 2015 (20-30 August 2015), Indonesian car sales continued to shrank in August due to people’s weaker purchasing power amid the country’s economic slowdown. In August a total of 90,077 cars were sold in Southeast Asia’s largest economy, down 6.9 percent from the same month last year, according to the latest data from the Indonesian Automotive Industry Association (Gaikindo).

Lanjut baca ›

Sejalan dengan perkiraan dan tren sejarah, penjualan mobil di Indonesia naik - dalam basis bulanan - di Juni 2015 menjelang perayaan Idul Fitri (yang menandai akhir bulan puasa umat Muslim). Penjualan mobil di Indonesia biasanya naik menjelang Idul Fitri, sebuah tradisi yang melibatkan perpindahan sementara jutaan orang Indonesia dari kota-kota ke daerah asal mereka. Sebelum perjalanan ke tempat asal, sebagian dari para pemudik ini membeli mobil baru, keputusan yang sering dipengaruhi oleh kampanye promosi dan program diskon.

Lanjut baca ›

We are gradually approaching the first 100 days in office of the new administration in Indonesia (under the leadership of President Prabowo Subianto). Does that show in the latest economic indicators?

Lanjut baca ›

As usual, we devote one article to the latest available (key) macroeconomic data in an effort to assess the state of the Indonesian economy. In the previous article in this month’s report, we discussed the 4.95 percent year-on-year (y/y) GDP growth rate of Indonesia in Q3-2024. In the article you are reading right now, we’re going to take a closer look whether the country’s economic growth can accelerate (or decelerate) in the last quarter of the year.

Lanjut baca ›

The holy Islamic fasting month (Ramadan) and the weeklong celebrations that mark the end of the Ramadan (known as Idul Fitri or Lebaran in Indonesia) is important for the Indonesian economy as it is a period when people consume more than usual.

Lanjut baca ›

The biggest problem for western car-makers is the dominant position of Japan in Indonesia's automotive market. Japan has been dominating the Indonesian car market since the 1970s and there are no signs that this situation will change in the short or long term.

Lanjut baca ›

After Ford Motor Indonesia, the local unit of American car manufacturer Ford Motor Company, exited Indonesia earlier this year as the company found it too difficult to compete with Japanese counterparts on the Indonesian market, Ford found a new way to make sure its components and after sales services can be delivered in Southeast Asia's largest economy.

Lanjut baca ›

The government of Indonesia eyes rapid growth of car exports in the two decades ahead. By the year 2035 the government targets to see car shipments from Indonesia rise to 1.5 million vehicles (from around 200,000 exported units in 2016). By that year, exported vehicles should contribute 37.5 percent of total Indonesian car sales.

Lanjut baca ›

Indonesia's automotive industry is centered around Bekasi, Karawang and Purwakarta in West Java. In this area various big global car-makers invested in industrial estates as well as car and component manufacturing plants. Therefore, it has become the production base of Indonesia's automotive sector (including motorcycles) and can be labelled the "Detroit of Indonesia". Detroit (Michigan, USA) is the birthplace of the US automotive industry and is home to car giants General Motor, Chrysler, and Ford.

Lanjut baca ›

Indonesians love the multipurpose vehicle (MPV), known as "people carriers", as these vehicles are bigger and taller than the family car. Indonesians enjoy taking trips with the family (and/or invite some friends) and therefore a big car is required. The MPV can carry up to seven passengers and thus meets this request. Car manufacturers are aware of high MPV demand and therefore continue to launch new (and better) models. With functionality in check, manufacturers now particularly focus on improving the design of the MPV to entice Indonesian consumers.

Lanjut baca ›

In early 2016 Ford Motor Indonesia, the local unit of American car-maker Ford Motor Company, announced it will have completed its exit from Indonesia (and Japan) by the start of 2017. This decision was made because Ford has been unable to compete with its Japanese counterparts on the markets of Indonesia and Japan. The sudden move to exit Indonesia was not warmly welcomed by Ford Motor Co's dealers in Indonesia. The 31 Ford local dealerships demanded USD $75 million in compensation. More recently, Ford Motor Indonesia has become the center of a tax scandal.

Lanjut baca ›

The Indonesian Automotive Industry Association (Gaikindo) raised its target for Indonesia's car exports (completely built up units, or, CBU) to 220,000 vehicles in 2016. This figure implies Gaikindo targets to see a 6 percent (y/y) increase in car exports from 207,691 units last year. Gaikindo Chairman Jongkie Sugiarto said the global economy has started to stabilize and this should have a positive effect on Indonesia's car shipments.

Lanjut baca ›