"Good for business, good for family trips"

"Good for business, good for family trips"

Lukas Subagio, Contributor, Jakarta

A number of analysts and observers say the Indonesian economy
is gradually recovering -- at least, in the macroeconomic sense
-- from the worst effects of the 1997 economic crisis.

Among the various indicators that make many manufacturers and
business people sigh with relief is the strengthening of
consumers' purchasing power, especially of those living in the
country's major cities. Automotive sales, likewise, are also
improving.

Indonesia -- the world's fourth most populous country -- has
for years been a lucrative market for the automotive industry.
What is unique, given the country's low income per capita, is
that even the most expensive cars have buyers. For many
Indonesians, having a car is a matter of prestige and a sign of
his or her status, more than their prosperity.

Demands for certain brands are so high that they have to be
ordered in advance, about two to three months prior to delivery.
The automotive market is one of the most thriving in Indonesia. A
quick look at the various media will prove this. Almost every two
or three weeks a new model is launched. Automotive exhibitions
are frequently held in many large cities here. Next to product
launches, the media also prints news and articles related to the
automotive industry. It is indeed a brisk world whose players
strive to offer the customers the best possible services,
discounts, gifts etc. Special clubs are also formed to maintain
customer loyalty.

Advancements in automotive technology as well as the fierce
competition have given birth to newer types of vehicles. Years
back, there were mainly three categories: sedan, minibus and
commercial vehicle. In recent years, a major revolution in
engines and designs has occurred causing sharper segmentation.

Next to the sedan category, that includes small or luxury cars
up to the sporty models, a newer sub-category is growing in
popularity worldwide, including in Indonesia. It is the
multipurpose vehicle (MPV), the fusion of a sedan and a minibus
with all the pluses thrown in. It is the solution to those who
want the best of both worlds.

One of the reasons behind the success of MPVs in the country
is that they match the Indonesian consumers' needs for a vehicle
that is multifunctional, meaning for business, leisure and family
outings. Another reason is probably the low ratio of car
ownership in Indonesia and the economical price of MPVs available
on the market.

The smarter models of MPVs today make their owners feel just
as confident as those with sedans. So, their pride or "prestige",
as they prefer to call it, is not hurt and they get their money's
worth.

The past three years have seen a significant growth in the
sales of MPVs in Indonesia. This category is now about 30 percent
of the entire national sales of vehicles, which is further
evidence that they are not only here to stay but that increased
growth can be expected. MPV owners even quip, quoting the ad line
of one brand, "Ok for business, Ok for family trips, Ok for going
anywhere ...."

The MPV category is now also experiencing the tightest
competition. Almost every authorized agent and manufacturer has
at least one MPV brand on the market: Toyota with its Kijang,
Panther from Isuzu, Aerio made by Suzuki, Stream coming from
Honda and KIA with two brands -- Sedona and Carrens -- just to
name a few.

Due to the limited knowledge of car owners, some producers
have got away with calling their products MPVs, though theirs are
not MPVs in the true sense of the word. A vehicle can be
categorized as an MPV based on its specifications, body design,
interior, passenger capacity etc. Multi-functionality along with
the greatest comfort and easy handling are the main elements or
prerequisites.

Most reputable manufacturers are conducting educational
advertising campaigns and PR activities so that their "real" MPVs
are not confused with the so-called ones. This is only part of
their efforts to gain a strong foothold in the market that
comprises demanding and fickle consumers.

Naturally, another vital part of their marketing strategy is
in making available a nationwide after-sales service with quality
spare parts. Regularly providing free service that includes
warranty and genuine parts is another way of giving customers a
secure feeling in the brands they have purchased. This is further
enhanced by importing engineers and mechanics from the home
country, as done by KIA, for example, to ensure the high
standards of vehicle maintenance.

With this kind of atmosphere in the domestic automotive
industry, especially where producers sincerely care for their
customers, who can predict how high sales will go. Including the
increasingly popular MPVs. -- The writer is Deputy Marketing
Director of PT KIA Mobil Indonesia