Alarm Bells for Affordable Cars: First-Time Buyers Now Coming from Upper Segments

Jakarta — Amid pressure on the national automotive market, the first-time car buyer segment is said to be holding steady. However, the profile of these consumers is beginning to change. Where entry-level buyers once dominated, growth is now coming from groups with greater purchasing power.

PT Astra Daihatsu Motor (ADM) Director of Marketing and Corporate Communications Sri Agung Handayani said that, based on the company’s internal surveys, first-time car buyers remain present in the market. The difference is that the segment showing movement is no longer the lowest tier.

“Are there first-time car buyers? Yes. But they are high-end first-time car buyers,” Sri Agung said in Jakarta recently.

According to her, economic conditions have placed the middle class under strain. Several industrial sectors, including textiles, footwear, and tobacco, have experienced a slowdown since the second half of last year. The impact has been felt among groups who previously had steady incomes but have now fallen into the vulnerable category.

This situation has affected two key aspects of vehicle purchasing: buying power and repayment capacity. Not only are decisions to buy new cars being delayed, but the ability to maintain instalment payments among consumers who already own vehicles is also being compromised.

These conditions have made the entry-level segment the hardest hit. Sales in the lower price bracket, including low-end MPVs and some medium SUVs, are reported to have come under pressure compared with the previous year.

Nevertheless, ADM noted that the market continues to show movement among more established groups. Consumers purchasing their first car from the upper-middle class are considered to still have the confidence to proceed with purchases.

Daihatsu has long been known for its strength in the affordable car segment and among first-time buyers, including consumers upgrading from motorcycles to cars. Sri Agung affirmed that the company remains committed to supporting national motorisation by providing products suited to the needs of various social strata.

However, she acknowledged that current economic dynamics have weakened the entry-level market. As a result, the company’s strategy is being directed towards maintaining a balance between penetrating new markets and retaining existing customers.