BMW, Mercedes expect robust sales

JAKARTA (JP): The sole agents of BMW and Mercedes-Benz expect bullish sales this year thanks to market recovery and a more favorable government automotive policy.

The sole agent of BMW in Indonesia, PT Tjahja Sakti Motor, said on Thursday that sales were expected to reach about 2,500 vehicles this year, up from about 900 last year.

While the sole agent of Mercedes-Benz, PT DaimlerChyrsler Indonesia, predicted its sales this year would swell to about 2,000 vehicles from only 600 last year.

"The car market will continue to recover and will be even more dynamic with no limits on the importation of completely built-up (CBU) cars," president of Tjahja Sakti, Prijono Sugiarto, told a news conference.

He said the government's recent decision to revoke a decree banning the importation of certain types of CBU cars had received a warm welcome from customers, who had gradually regained their purchasing power.

Minister of Industry and Trade Luhut Pandjaitan revoked last week a decree made in February by the previous minister that banned the importation of CBU cars with an engine capacity exceeding 4,000cc or with tag price of more than US$40,000.

He said the decree violated the principles set by the World Trade Organization.

Indonesia eased the restriction on the importation of CBU cars in July last year by cutting import duty to a range of between 65 percent and 80 percent depending on engine size from as high as 200 percent.

However, in February this year then minister Jusuf Kalla issued a decree to ban the importation of more expensive CBU cars with an engine capacity exceeding 4,000cc or priced over $40,000 a vehicle, arguing that the presence of such luxurious cars would only cause social jealousy.

Prijono said the market's enthusiasm for imported CBU cars was indicated in the many inquiries the company had received so far.

He said the CBU BMW models that would be available this year included the Rp 839 million (US$106,125) station wagon BMW 528iA- T, which would be available in August, and the Rp 1.1 billion off roader jeep BMW X5 4.4A, which was expected to arrive in November.

"We have so far sold 150 vehicles through the indent system in which a customers has to wait some time before their car is delivered," he said.

He said Tjahja Sakti expected to sell about 300 CBU vehicles, or about 10 percent of its predicted total sales this year.

Separately, corporate communications manager of Mercedes- Benz's sole agent DaimlerChrysler Indonesia, Wim Ekel, said the company expected to sell about 1,000 imported CBUs out of the total predicted sales this year of around 2,000 vehicles.

"So far, we have sold about 400 CBUs," he said, adding that CBU Mercedes-Benzs available here included the A140, ML320, ML270 and S320 with price tags ranging from Rp 235 million to Rp 1.3 billion.

Both Tjahja Sakti and DaimlerChrysler said they would maintain their core business of car assembling despite the promising CBU car import business.

Tjahja Sakti's Prijono said the sales of the imported CBUs would never be able to exceed that of locally assembled vehicles because the market for CBUs was very limited.

"It is possible we could sell more CBU BMWs than locally assembled vehicles if the government reduced the import duty and luxury tax dramatically, which would cut the price of CBUs," he said.(cst)