Motorcycle sales to exceed precrisis level in 2002

Motorcycle sales to exceed precrisis level in 2002

The Jakarta Post, Jakarta

Looking at the improved economic situation, the Indonesian
Motorcycle Industry Association (AISI) predicts that motorcycle
sales will surpass the two million mark this year,

Association chairman Ridwan Gunawan predicted that sales would
increase by 10 percent to about 2.1 million motorcycles this
year, surpassing the precrisis sales level of 1.85 million units.

"At a conservative level, a 10 percent sales growth is logical
this year," Ridwan said in a statement, adding that AISI members
plan to produce a total of two million motorcycles.

AISI groups agents and assemblers of popular Japanese brands
such as Honda, Yamaha, Suzuki and Kawasaki as well as Italy's
Piaggio Vespa.

Producers of Chinese motorcycles, which started to challenge
the domination of Japanese motorcycles in the country after the
economic crisis, are not members of the association.

AISI said that as of November last year its members recorded
domestic sales of 1,571,426 motorcycles, higher than the 898,572
units over the same period in 2000.

"Sales were strong in December 2001 but due to the shorter
production days, total sales for 2001 probably reached 1.67
million units," he said.

The association projected that total domestic sales, including
those from outside AISI members, would reach around 1.8 million
units in 2001.

Motorcycle sales of AISI's members dropped to their lowest
level of 492,626 in 1998 from 1.85 million in 1997 as the country
suffered the pinch of its worst economic crisis.

Motorcycles' sales started to recover in 1999, with total
sales of 587,402 units.

Sales further increased to 979,000 motorcycles in 2000,
despite the entry of several Chinese brands into the domestic
market.

At least 57 brands of Chinese motorcycles have entered the
Indonesian market since the government eased regulations on the
importation of completely built-up motorcycles in late 1999.

Ridwan predicted that total imports of built-up motorcycles
would reach 250,000 units this year, of which about 150,000 units
would come from China.

He said that the implementation of the World Trade
Organization agreement would make it difficult for Chinese
motorcycle producers to export more products to Indonesia.

"So the imports of motorcycles from China will not be too
dominant while intra-ASEAN trade will increase following the
implementation of the ASEAN Free Trade Area (AFTA) this year," he
said.

Under the AFTA scheme, three ASEAN countries -- Indonesia,
Thailand and the Philippines -- will open their markets for
automotive products that meet local content requirement with
lower import tariffs of between zero and 5 percent.

Ridwan added that AISI members planned to export around
150,000 motorcycles this year.

Indonesia exports its motorcycles mainly to Vietnam, the
Philippines, Argentina and Brazil.