Astra predicts slump in motorcycle sales<\/p>\n
Naila Firdausi and Grace Nirang, Bloomberg, Jakarta<\/p>\n
Motorcycle sales in Indonesia may fall by as much as 10
\npercent in 2006 because of higher interest rates and fuel prices,
\nsaid a unit of Indonesia's biggest car and motorcycle distributor
\nPT Astra International.<\/p>\n
The country's motorcycle sales may slow by between 5 and 10
\npercent from 5.3 million units estimated for 2005, Tossin
\nHimawan, executive vice president director of PT Astra Honda
\nMotor, said yesterday in Bogor, West Java. In 2004, sales were
\n3.88 million units.<\/p>\n
"Consumer purchasing power fell after the jump in fuel prices,
\nwhile interest rates are climbing, damping demand for loans,"
\nHimawan told reporters. About 75 percent of motorcycle sales were
\nfunded through loans, Himawan said. "Demand may be shrinking."<\/p>\n
The Indonesian government on Oct. 1 more than doubled fuel
\nprices for individual users to prevent fuel subsidies draining
\nthe nation's finances. The move sent the inflation rate in
\nOctober and November to six-year highs and prompted the central
\nbank to raise its benchmark interest rate to a three-year high on
\nNov. 1.<\/p>\n
Higher fuel prices, which doubled for automotive diesel and 88
\npercent for gasoline, will cut car sales in 2006, Astra said.
\nSales in November reached a two-year low.<\/p>\n
Indonesian car retailers sold 25,600 units of vans, jeeps and
\nsedans last month, said Johnny Darmawan, a director at PT Astra
\nInternational.<\/p>\n
That's the lowest monthly sales since 21,684 units sold in
\nNovember 2003, according to data compiled by Bloomberg. In
\nNovember last year, sales were 35,157 units and in October this
\nyear 35,103 units.<\/p>\n
Last year, carmakers in Indonesia sold 483,295 units of vans,
\njeeps and sedans, according to the Indonesian Association of
\nAutomotive Industries, or Gaikindo. Astra forecast sales of
\nbetween 525,000 and 530,000 this year.<\/p>\n
"Next year, with lower purchasing power and high interest
\nrates, plus higher taxes, they will be between 400,000 to 500,000
\nunits depending on interest rates," Darmawan said. "If interest
\nrates start declining in March, they will likely be in the
\n450,000 to 470,000 range."<\/p>",
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