INDONESIA SALES OF 8 MILLION FAIL TO MEET EXPECTATIONS
February 9 2012.

Motorcycles sales in Indonesia, the third largest global market behind China and India, grew 8.65% to 8.04 million units in 2011 yet failed to meet the expectations of the Indonesian Motorcycle Industry Association (AISI).

AISI chairman Gunadi Sindhuwinata believes the reason is due to a disruption in the supply of components from Thailand, the automotive industry's Southeast Asian base, following the country's worst floods in decades.

He said: "We exchange a large number of components with Thailand, so the floods really affected local producers, especially in the last months of the year."

The AISI data reveals that motorcycle sales in the January-November period reached 7.58 million, which was on target to meet AISI estimates. However, sales in December dropped by 27.96% to 463,431 units.

Honda remained market leader in Indonesia with sales topping 4.28 million units, equating to 53.16% of the market. Yamaha was the second with 3.15 million units (39.14%) followed by Suzuki and Kawasaki, contributing a 6.15% and 1.25% market share respectively.

Gunadi said that amid the current global economic slump, local motorcycle manufacturers still held a positive outlook on this year's motorcycle sales. "We still predict that our domestic motorcycle sales can still grow more than 10% to 9 million units," he said, adding that a stable expansion of sales would depend on steady economic growth to improve people's purchasing power.

Gunadi also added that higher growth would also depend on demand from regions outside Java, as the regional market - particularly in Greater Jakarta and West Java - representing 15% of sales nationwide - as their market was already saturated.

Indonesia's economy also grew by 6.5% until the third quarter of last year, which is among the highest expansion rates in Asia, according to Central Statistics Agency (BPS).