Old players remain dominant in local market<\/p>\n
Rikza Abdullah, Contributor, Jakarta<\/p>\n
The success of the locally assembled multi-purpose vehicles
\n(MPVs) in the domestic market has encouraged distributors to
\nimport similar types of cars but with a higher quality and more
\nalluring designs.<\/p>\n
But old players such as Kijang, Panther and Kuda vans continue
\nto dominate the market despite there being so many choices
\navailable for car lovers.<\/p>\n
Local producers, under a government policy requiring them to
\ngradually increase the local-made content of their vehicles, have
\nmodified light trucks into MPVs or mini-buses.<\/p>\n
The Astra Group of companies, for example, produces Kijang
\nMPVs based on truck chassis with Toyota engines, and Panther MPVs
\nbased on truck chassis with Isuzu diesel engines, while PT Krama
\nYudha Tiga Berlian produces Mitsubishi Kuda MPVs.<\/p>\n
For customers with lower incomes, Astra modifies Daihatsu
\nlight trucks into Zebra mini-buses, the Indomobil Group of
\ncompanies modifies Suzuki light trucks into Carry and Futura
\nmini-buses, and PT Krama Yudha Tiga Berlian modifies Mitsubishi
\nlight trucks into Colt mini-buses.<\/p>\n
Because all these products have won lion shares on the
\ndomestic automotive market, local distributors of foreign brands
\nare trying to take a slice of the market by importing MPVs with
\ndesigns and technology features better than those domestically
\nproduced.<\/p>\n
Indomobil, for instance, imports Suzuki Escudo, Suzuki Aerio
\nand Nissan Terrano MPVs, and PT Kia Motors Indonesia imports
\nCarnival and Sedona. PT Astra France Motors imports Peugeot
\n307SW, and PT Honda Prospect Motors imports Honda CR-V and Honda
\nStream MPVs. The other MPVs imported for the domestic market
\ninclude Chevrolet's Zafira and Tavera, Hyundai's Santa Fe,
\nMitsubishi's Pajero, Renault's Clio M\/T and Scenic, Land-Rover's
\nEscape, Ssangyong's Musso and Rexton, Mercedes-Benz's Vaneo,
\nBMW's X5 and Toyota's Land-Cruiser.<\/p>\n
According to the data released by the Indonesian Association
\nof Automotive Manufacturers (Gaikindo), the domestic sales of
\nCategory I vehicles (including two-wheel-driven MPVs, minibuses
\nand light trucks) increased by 12.63 percent to 117,669 units
\nduring the first semester of this year from 104,473 units in the
\nsame period last year.<\/p>\n
Gaikindo secretary general Fransiscus Suseno said that about
\n80 percent of Category I vehicles sold on the domestic market
\ncomprised two-wheel-driven MP vehicles and minibuses, while the
\nother 20 percent consisted of light trucks or pick-ups.<\/p>\n
Indomobil Group chairman Soebronto Laras, who is also a former
\nchairman of Gaikindo, said the fact that the sales of the
\nCategory I vehicles increased substantially, while the sales of
\npassenger cars (sedans) declined in the first semester, indicated
\nthat Indonesians put higher priority on the multi-purpose
\nfunctions of the vehicles (rather than their technology
\nfeatures).<\/p>\n
The sales of sedans, according to Gaikindo, declined by 25.73
\npercent to 13,515 units in the January-June period from 18,198 in
\nthe same period last year.<\/p>\n
Suseno commented that the trend of customers' demands towards
\nMPVs was caused primarily by economic considerations. As compared
\nto sedans that could accommodate four to five passengers, MPVs
\ncould accommodate seven to 10 passengers. And the rates of
\nluxury-goods-sales tax on sedans were also higher than that on
\nMPVs.<\/p>\n
The sales of two-wheel-drive MPVs are subject to 20 percent
\nluxury tax, while the rates of luxury tax on sedans are set at 30
\npercent for those with engines of no more than 1,000 cc (cubic
\ncentiliters), 40 percent for those with engines of more than
\n1,000 cc but not more than 3,000 cc, and 75 percent for those
\nwith engines more than 3,000 cc, he said.<\/p>\n
Furthermore, Soebronto said, Indonesians seemed to have been
\nmore content with the designs of the locally-produced MPVs or
\nvans. Their sales prices, ranging from Rp 75 million (about
\nUS$8,330) to Rp 200 million each, were also within the reach of
\nmost Indonesian customers.<\/p>\n
Imported MPVs, in spite of their better specifications,
\ntherefore, would find it difficult to compete with locally-
\nproduced vans because the former's prices exceeded Rp 200 million
\neach, he said.<\/p>\n
He said the monthly sales of Kijang, for example, could reach
\nabout 6,000 units, Panther about 2,000 units, Kuda about 1,000
\nunits and Daihatsu's Taruna about 800 units, while his business
\ngroup could sell about 2,500 Suzuki (Carry and Futura) mini-buses
\na month.<\/p>\n
According to the data released by the Astra Group, its sales
\nof Toyota commercial vehicles (comprising both Kijang vans and
\npick-ups) reached 37,991 units during the January to June period,
\nIsuzu vehicles (including Panther vans and pick-ups) reached
\n14,140 units and Daihatsu vehicles (including Taruna MP vehicles,
\nZebra mini-buses and pick-ups) reached 10,142 units.<\/p>\n
On sales by other companies, the data show that 37,654
\nMitsubishi commercial vehicles (including Kuda and Colt vans and
\npick-ups as well as heavy trucks) and 29,239 Suzuki vehicles
\n(including Escudo MP vehicles, Carry and Futura mini-buses and
\npick-ups) were sold during the period.<\/p>\n
Soebronto said the sales of imported MPVs would not exceed 500
\nunits per month for each type. Honda's CR-V led the market with
\nthe sales of about 500 units per month, followed by Suzuki's
\nEscudo with 400 units.<\/p>\n
According to Astra's data, the sales of Honda MPVs reached
\n3,449 units in the first semester of this year, Nissan 1,726
\nunits, Opel 868 units, Chevrolet 339 units, Ssangyong 64 units
\nand Land-Rover 23 units.<\/p>\n
Soebronto said four-wheel-drive MPVs with engines of more than
\n3,000 cc had more difficulty in increasing sales in the country
\nafter the government raised the rate of their luxury tax from 50
\npercent to 75 percent last August.<\/p>\n
Gaikindo's report shows the sales of Category IV vehicles
\n(four-wheel-drive MPVs) fell 39.22 percent to 747 units during
\nthe first semester of this year from 1,229 units in the same
\nperiod last year.<\/p>\n
Suseno said the absence of after-sales service warranties
\nadded to the difficulty of the sales of four-wheel-drive MPVs
\nimported by non-Gaikindo companies.<\/p>\n
\"So, they (the importers) are actually competing in the thin
\nmarket,\" Soebronto said. \"And their entry into the Indonesian
\nmarket will not reduce the shares of the locally made vehicles.\"<\/p>\n
However, importers show optimism. Anto Nurdiyanto, a deputy
\ndirector of PT Daimler Chrysler Distribution, for example, said
\nthat his company aimed at increasing the sales of Grand Cherokee
\nto 130 units this year from less than 100 last year.<\/p>\n
Luis F.F. Madaleno, president of PT General Motors Indonesia,
\nsaid his company aimed to sell 5,000 Chevrolet vehicles this
\nyear.<\/p>",
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