Market leader Astra Honda sees 25% growth in sales for 2005

The Jakarta Post, Jakarta

Astra Honda Motor, which holds a more than 50 percent share of the motorcycle market, expects up to 25 percent growth in sales this year on the back of continued strong performance of the overall industry.

The Indonesian Motorcycle Industry Association (AISI) earlier estimated that motorcycle sales were likely to increase by 20 percent to 4.6 million units from last year's 3.9 million -- from which the association said contributed about Rp 40 trillion (US$4.4 billion) to gross domestic product (GDP).

Affordable motorcycles -- costing between Rp 8 million and Rp 11 million each -- plus easier loan terms, are among the reasons behind the projection.

"We sold 2,037,000 motorcycles last year and we hope that in 2005 we can expand our market by 25 percent," the executive vice president director of Astra Honda Motor, Tossin Himawan, told The Jakarta Post on Saturday.

Tossin said the company would still focus on selling Cub motorcycles -- a versatile bike with a 100cc four-stroke engine.

"Cubs have taken over about 90 percent of the country's motorcycle market. A lot of people buy it because it's good for men and women," said Tossin, adding that the Kharisma X had became the favorite Honda Cub motorcycle.

In the first quarter of the year, Astra Honda Motor sold 567,488 Cub motorcycles, more than the combined sales of other members of AISI: Suzuki, Kawasaki, Yamaha, Kymco and Kanzen, which stood at 454,742.

In total, Astra Honda sold 617,868 motorcycles in the first quarter, out of the total 1,151,209 sold throughout the country. Tossin said first-quarter sales increased by 30 percent compared to last year.

The company is a subsidiary of PT Astra International, a holding company with over 120 subsidiaries in 10 business sectors, with its core businesses in the automotive industry.

The company has earmarked $25 million for capital expenditure, mostly to expand the capacity of its car and motorcycle assembly plants. (001)