Japanese motor cycles still perform well despite Chinese entry

JAKARTA (JP) : Japanese motorcycle producers said here on Monday that their sales in the Indonesian market remained bullish, despite growing competition from their Chinese partners.

The Indonesian Motorcycle Industry Association (AISI), which groups subsidiaries of the Japanese motor cycle companies, said that sales from January to April this year surged by 80 percent to 466,000 motor cycles, from 260,000 over the same period last year.

The association's chairman Ridwan Gunawan said people still preferred buying Japanese brands due to their better quality and after-sales service.

"The sharp increase in the sales indicates that motor cycles that offer better quality remain the prime choice of local buyers," he told a media briefing. "It also indicates that demand in the country continues to grow rapidly."

In 1998, the motor cycle sales of the association's members dropped to 492,626 from 1.85 million in 1997 as the country felt the pinch of its worst-ever economic crisis. Sales started to recover in 1999, with 587,402 units sold that year. The association's sales further increased to 979,000 motor cycles in 2000, despite the entry of several Chinese brands into the domestic market.

About 57 brands of Chinese motorcycle have entered the market, since the government eased regulations on the importation of completely built-up motorcycles in late 1999. Many people, especially at the lower end of the market, have turned to Chinese motor cycles that are sold here 50 percent cheaper than the Japanese brands.

The association, which consists of manufacturers of Japanese brands Honda, Yamaha, Suzuki, and Kawasaki, and Italian brand Piaggio Vespa, said that the Chinese motor bikes have taken 22 percent of the local motor cycle market.

The association is optimistic it will be able to meet its target to raise sales by 35 percent, to 1.3 million motor cycles this year, Ridwan added.

Ridwan said that AISI also estimated that motorcycles exports would increase by about 5 percent to 120,000 motor cycles this year, from 115,000 units last year.

Realized exports during the first four months increased by 11 percent to 40,000, compared with 36,000 in 2000, he said.

Indonesia mainly exports its motorcycles to Vietnam, the Philippines, Argentina and Brazil, he added. (05)