Friday, 19 July 2019 | 04:35 WIB

Automotive Market Expected to Grow Positively in 2019

Illustration: Car dealer

BANDUNG, NNC - Automotive observer Yannes Martinus Pasaribu predicts that the domestic automotive market in 2019 will advance in a more positive direction.

There are a number of factors behind this opinion, including the growing trend of people's purchasing power, the strengthening of the rupiah against the dollar, the relatively conducive political situation ahead of the general election and the presence of the latest models of both cars and motorcycles.

"Looking at the current trend, the automotive market in Indonesia will tend to be more positive than in 2018," Yannes said on Thursday (01/03/2019).

In addition, Yannes also saw the export sector of four-wheeled vehicles continue to increase. He assessed the products of domestic export vehicles, especially in the low MPV segment, which had a potential market including in the Southeast Asia region.

"The export market will continue to increase for the ASEAN market. One that stands out is the low-medium MPV product built in multinational industries in Indonesia," Yannes said.

"Especially for Xpander, the trend of interest in the ASEAN market seems to be increasing, it seems to be booming in the Philippine and Malaysian markets, and the prices there are better than the local market," he added.

Meanwhile, General Secretary of the Association of Indonesian Automotive Industries (Gaikindo) Kukuh Kumara when contacted separately said that in 2019 it targets total car sales to reach 1.1 million units, the same as last year's sales target.

Although the sales target announced this year is the same as last year, Kukuh is optimistic that the automotive market in Indonesia will continue to bloom.

"We hope that the indicator during the period the economy has relatively grown in the range of 5.1 percent, and then Indonesia is relatively in a fairly good category among other countries, so we hope it can still reach around 1.1 million cars in 2019 even though we somewhat cautious because there will be a political year," said Kukuh as quoted from Antara.

Kukuh saw there were a number of factors that could boost vehicle sales this year. One of them is infrastructure development that continues to be encouraged by the government in various regions in Indonesia.

According to him, massive and equitable infrastructure development can help improve the economy of the people in the regions, which in turn will have a positive impact on increasing purchasing power.

Despite optimism, Kukuh remains wary of external factors that might affect vehicle sales in 2019.

"Although optimistic, there is a trade war in the world, and so on, uncertainty too. But if we can reach [target] at least the same as 2018, that's good. The amount of exports may also increase," said Kukuh.

Awaiting regulation of electric vehicles

In 2019 it is estimated that there will also be a momentum for the presence of a new era of electric vehicles in Indonesia because the government in the near future will soon complete the draft Presidential Regulation on electric vehicles.

Presidential Chief of Staff Moeldoko some time ago mentioned that the draft Presidential Regulation on electric vehicles is targeted to be completed by the beginning of 2019.