World Cup to boost TV sales by 20-30 percent

Adianto P. Simamora, The Jakarta Post, Jakarta

The World Cup soccer tournament, coupled with the strengthening of the rupiah against the U.S. dollar, will increase television sales in the first half of this year by between 20 percent and 30 percent, according to experts.

"We have learned from past experience that the sale of televisions will rise by somewhere between 20 percent and 30 percent," Sung Khiun, marketing manager for PT LG Electronic Indonesia, told The Jakarta Post over the weekend.

Millions of Indonesian soccer fans will watch the World Cup tournament on TV. The tournament for the first time will take place in Japan and Korea, starting at the end of May.

Sung said that the strengthening of the rupiah against the dollar had caused the price of electronic goods to fall.

The lower prices were made possible as the stronger rupiah made the importation of components for electronics manufacturing cheaper.

The local currency has been appreciating since the beginning of this year. On Friday, the rupiah was quoted at Rp 9,080 against the U.S. dollar, the best showing since Sept. 14, 2001.

"With the rupiah strengthening to about 9,300, the price of electronic goods has declined by an average of 10 percent," Sung said.

"It is the right time now to buy electronic goods because I think these will be the lowest prices for this year," he added.

The price of an LG 14-inch TV set, for example, has declined to between Rp 850,000 and Rp 900,000 compared to last year's price of above Rp 1 million. An LG 21-inch TV is now selling for about Rp 1,800,000, down from the previous price of more than Rp 2 million.

Data from Audio Video magazine shows that a Sanyo 20-inch TV is now to be had for around Rp 1.5 million, while a 20-inch Sharp is selling at Rp 1.7 million.

According to the magazine, the best buy in the 20-inch television range in April was a Sanyo. while for non-stereo TVs, the best buy was a Samsung CS-20R1, with a price tag of Rp 1.39 million.

Sung, however, said that if the rupiah continued to strengthen to lower than Rp 8,500, the country's electronic exports would be badly hit because it would make them less competitive.

Lee Khan Hyu, an executive of the industry association (GABEL), said that sales of electronic goods in the first quarter were still slow despite the stronger rupiah as buyers were waiting for the prices to decline further.

"The market is still weak. Most buyers are delaying buying electronic goods in the hope of getting a better bargain based on the further strengthening of the rupiah," Lee, who is also an executive of PT Samsung Indonesia, told the Post.

He said, however, that if the rupiah strengthened to Rp 9,000, the price of electronic goods would only be cut by between 5 percent and 10 percent.

Last year, some 2.7 million TV units were sold.

As of April this year, the number of units sold reached 900,000, 20 percent higher than during the same period last year.