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Indonesia’s Recovering Car Market May Stall
Demand for passenger vehicles in Indonesia is likely to drop to a three-year low in the first half of 2017, the Financial Times predicts.
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Demand for passenger vehicles in Indonesia is likely to drop to a three-year low in the first half of 2017, the Financial Times predicts.
Car sales in the country, which plunged 16% to 1 million units in 2015, expanded by an estimated 4% last year. The Assn. of Indonesian Automotive Manufacturers (Gaikindo) predicts the same growth rate for 2017.
But FT warns that the pace could slow or reverse in spite of more intense competition among carmakers. An index of purchase intent calculated by the newspaper’s independent FT Confidential Research service began to slip in the third quarter last year, sagging to 26.4 in the fourth quarter from 31.8 a year earlier.
The newspaper says threats to this year’s car market in Indonesia include the possibilities of weaker commodity prices, a tighter U.S. monetary policy and a failure of the government to meet aggressive spending targets.
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