Automotive mart stable in spite of new policy
Automotive mart stable in spite of new policy
JAKARTA (JP): Automobile prices are stable and buying patterns have not fluctuated in the capital despite a recent government policy allowing a domestic firm to produce cars without having to pay duties and luxury sales tax.
A number of dealers and sales supervisors from Daihatsu, Honda, Mazda, Nissan, Suzuki and Toyota told The Jakarta Post over the weekend that car sales have not been affected by the news that the new company's cars will sell at far lower prices when they hit the market later this year.
The government, under Presidential Decree No. 2/1996, is giving preferential treatment to PT Timor Putra Nasional, which will not have to pay luxury sales tax or duties on imported components provided that the local content in its products reach at least 20 percent by the end of the first year, 40 percent in the second year and 60 percent in the third year.
With the tax breaks, the company is expected to sell its cars at price levels 50 percent lower than those of comparable sedans.
Timor Putra -- owned by Hutomo (Tommy) Mandala Putra, the youngest son of President Soeharto -- in cooperation with Kia Motors Corp. of South Korea, will launch the Timor in October.
"Overall there hasn't been any change in the buying patterns of our cars since the policy was announced," said Imelda, branch manager of Indomobil Group's Suzuki dealer in South Jakarta.
Indomobil, the second largest assembler of cars in Indonesia after Astra, assembles Suzuki, Mazda, Nissan and Volvo vehicles.
Imelda said that every month her branch office sells an average of 200 Suzuki vans, sedans and jeeps. Vans are the best sellers at a price of about Rp 20 million (US$8,403).
"I think we'll sell around 200 vehicles this month," she said, adding that her office has not cut any prices or changed its marketing strategy to anticipate the policy's effect.
Noviar, a sales supervisor at an Astra dealer in Sunter, North Sumatra, also said that buying patterns at his dealership have not changed.
Astra assembles Toyota, Daihatsu, Isuzu and BMW vehicles.
"On average, we can sell 90 vehicles every month and this month we achieved the same," Novia said, adding that his best sellers are Daihatsu vans and Feroza jeeps.
He predicted, however, that his sales will probably drop in the sedan market, which the Timor will soon enter.
"In the future, we might change our marketing strategy and cut our prices. I don't know yet. Let's just wait and see," he said, adding that the most he can do now is monitor the market.
Astra's main dealer on Jl. Sudirman, Central Jakarta, also has not experienced a significant change in sales.
"There's been no drastic change here," said Ratna, a saleswoman at the dealership. (13)