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Today's Headlines Motorcycle Sales
Exports of Indonesian motorcycles surged 46.1 percent year-on-year (y/y) to 226,444 units in the January-May 2018 period (from 155,034 exported motorcycles in the first five months of 2017), according to the latest data from the Indonesian Motorcycle Industry Association (AISI). Sigit Kumala, Commercial Head at AISI, sees three reasons behind the robustly growing amount of motorcycle exports from Southeast Asia's largest economy.
Based on the latest data from the Indonesian Motorcycle Industry Association (AISI), motorcycle sales in Indonesia rose 1.8 percent year-on-year (y/y) to 482,537 units in the first month of 2018. Although it is only modest growth, it does give rise to optimism about the direction of domestic motorcycle sales this year, according to AISI Chairman Johannes Loman.
Although motorcycle sales in Indonesia fell slightly in 2017, an improvement was detected. Sales fell 0.76 percent year-on-year (y/y) to 5.88 million motorcycle units in 2017, improving from a 8.4 percent (y/y) decline in the preceding year. Meanwhile, the Indonesian Motorcycle Industry Association (AISI) predicts a rebound as it expects growth up to 3 percent (y/y), or around 6 million motorcycles, in 2018.
Exports of motorcycle units from Indonesia rose sharply. Based on the latest data from the Indonesian Motorcycle Industry Association (AISI) Indonesia shipped 223,229 motorcycles abroad in the January-July 2017 period, up 35.1 percent from motorcycle exports in the same period one year earlier.
Not only Indonesia's domestic motorcycle sales rose in May 2017. Also exports of motorcycles from Indonesia grew rapidly in May. Based on the latest data from the Indonesian Motorcycle Industry Association (AISI), motorcycle exports from Indonesia rose 33.7 percent year-on-year (y/y) to 31,631 units in May. This growth was attributed to exporters' successful efforts to enlarge export markets (including adding new markets).
Sales of motorcycles in Indonesia showed an improvement ahead of the Idul Fitri celebrations in late June (a popular period to purchase a motorcycle unit). Based on the latest data from the Indonesian Motorcycle Industry Association (AISI) motorcycle sales grew 15.16 percent year-on-year (y/y) to 531,496 units in May 2017, the highest growth rate since August 2014. On a monthly basis motorcycle sales in Indonesia grew 36.96 percent (m/m).
While car sales are showing a rebound in Indonesia, motorcycle sales continue to decline. Based on the latest data from the Indonesian Motorcycle Industry Association (AISI), motorcycle sales in Southeast Asia's largest economy fell 15.9 percent year-on-year (y/y) to 473,896 units in March 2017 from 563,341 units in the same month one year earlier. AISI Chairman Sigit Kumala says Indonesian consumers continue to postpone the purchase of a motorcycle amid weak consumer purchasing power.
Indonesia's Business Competition Supervisory Commission (KPPU), the country's anti-monopoly agency, penalized Yamaha Indonesia Motor Manufacturing (YIMM) and Astra Honda Motor (AHM) for forming a cartel with the purpose of conducting price-fixing and curtailing the distribution of Yamaha and Honda motorcycle sales in Indonesia, specifically those motorcycles with an engine capacity of 110-125 cubic centimeters.
Indonesia's domestic motorcycle sales rose 13.8 percent year-on-year (y/y) to 473,879 units in January 2017, from 416,263 units in the same month one year earlier. This growth is attributed to Indonesians' improving purchasing power supported by recovering commodity prices, particularly coal and crude palm oil (CPO). Gunadi Sindhuwinata, General Chairman of the Indonesian Motorcycle Industry Association (AISI), is optimistic that Indonesia's motorcycle sales will rebound in 2017 - after two years of slowdown - on the back of accelerating economic growth and rising commodity prices.
Indonesia has the biggest motorcycle market within the ASEAN region. It is estimated that Indonesia accounts for 70 percent of total motorcycle sales in ASEAN. This implies that the slowdown in Indonesia's motorcycle sales has a big impact on overall sales in the region. Based on data from the ASEAN Automotive Federation (AAF), total motorcycle sales in ASEAN in the first ten months of 2016 fell 1.2 percent to 7.91 million from sales in the same period one year earlier.
Latest Columns Motorcycle Sales
Based on a statement made by Indonesian Coordinating Minister for Maritime and Investment Affairs Luhut Panjaitan in late-January 2023, Indonesian President Joko Widodo agreed to a scheme where Indonesians can enjoy an IDR 7 million (approx. USD $475) subsidy when buying a new electric motorcycle. Reportedly, this scheme is to be imposed in February 2023.
The Indonesian Motorcycle Industry Association (AISI) says Indonesia's motorcycle exports should rise by 50 percent (y/y) to around 342,000 units in 2016. Gunadi Sindhuwinata, General Chairman of the AISI, stated that Indonesia's motorcycle exports have been impressive so far this year, rising 76 percent (y/y) to 97,778 units in the January-April 2016 period. This impressive export performance is supported by the choice of several global motorcycle manufacturers to make Indonesia their production hub for specific motorcycles.
To assess Indonesia's purchasing power and consumer confidence it is always useful to take a look at car and motorcycle sales because when people are confident about their financial situation and have enough money to spend then they tend to buy cars and motorcycles (motorcycles are particularly popular among Indonesia's huge middle to lower-middle class segment). Meanwhile, cement sales inform about property and infrastructure development. Property development is also closely related to purchasing power and consumer confidence because property development grows when people's demand for property rises.
Car sales in Indonesia continued to decline. Based on the latest data from the Indonesian Automotive Industry Association (Gaikindo) Indonesian car sales (delivery to dealers) fell around 10 percent year-on-year (y/y) to 84,885 vehicles in the first month of the year from 94,194 units in January 2015. Retail sales, on the other hand, showed a 1 percentage point growth to 82,423 vehicles over the same period.
Both car sales and motorcycle sales declined in 2015 in Indonesia. Primary reason for this decline was people's weaker purchasing power amid the slowing economy and persistently low commodity prices. Indonesia's GDP growth is estimated to have fallen to 4.7 percent year-on-year (y/y), the slowest growth pace since 2009. Meanwhile, amid the sluggish global economy (especially China's slowdown) and falling oil prices, Indonesia gains relatively little from its commodity exports.
In a bid to boost economic activity in Indonesia, the central bank (Bank Indonesia) revised several regulations involving down payments for the purchase of cars and motorcycles as well as the maximum loan-to-value (LTV) ratios for first or more home purchases by Indonesian citizens. Yati Kurniati, Director of Bank Indonesia’s Macroprudential Department, said that the central bank implemented the looser monetary policy in the property and automotive sectors in an effort to boost credit growth, hence boosting the whole economy.
Within a couple of days Statistics Indonesia (BPS) is scheduled to release Indonesia’s GDP growth figure for the first quarter of 2015. Despite economic growth forecasts for full-year 2015 - both of the Indonesian government and international institutions such as the World Bank, International Monetary Fund (IMF) and Asian Development Bank (ADB) - signalling a rebound from the five-year low of 5.02 percent (y/y) in 2014, various analysts expect to see further slowing economic growth in Q1-2015.
Domestic sales of motorcycles in Indonesia fell 11 percent to 580,288 units in January 2014. The main reason for this decline in the first month of the year were severe floods brought about by high rainfall amid a peak of the rainy season. These weather conditions disrupted the distribution of motorcycles from factories to dealers. As a result, all motorcycle brands recorded lower sales figures according to data released by the Indonesian Motorcycle Industry Association (Aisi). However, more factors were at play.
Domestic sales of motorcycles in Indonesia are expected to have fallen by 20 percent to 550,000 in December 2013 compared to the previous month (688,527). According to the Chairman of the commercial department of the Indonesian Motorcycle Industry Association (AISI), Sigit Kumala, this decline is not the result of slowing demand for motorcycles but due to the limited amount of working days amid the Christmas and New Year holidays. This then led to less production and distribution of motorcycles to Indonesian dealers.
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