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August 19, 2021

Indonesia market rebound continued in July

Tax cuts and low interest rates helped to support Indonesia's vehicle market in July, in spite of a new wave of Covid-19 infections.

By David Leggett

Indonesia’s new vehicle market continued to rebound strongly in July 2021, by 164% to 66,639 units from depressed year-earlier sales of 25,283 units, according to member wholesale data compiled by industry association Gaikindo.

Record low interest rates and the suspension in March 2021 of the luxury tax on vehicles with engines smaller than 1500cc continue to provide strong support to the market, offsetting the impact of new social and business restrictions imposed at the beginning of July to fight a new wave of COVID-19 infections.

The current luxury tax exemption runs out at end of August, to be replaced by a discounted tax rate until the end of the year.

Additional tax discounts were introduced in April on a broader range of locally-produced light passenger vehicles, including four-wheel drive models and vehicles with engines up to 2.5L.

Total vehicle sales in the first seven months of 2021 rebounded by almost 61% to 460,105 units after falling by over 50% to 286,215units in the same period of last year, with passenger vehicle sales surging by almost 60% to 342,866 units while commercial vehicle sales rebounded by over 63% to 117,239 units.

Toyota reported a sales increase of close to 62% to 143,937 units year-to-date; followed by Daihatsu with a 63.9% rise to 84,111 units; Mitsubishi 58,864 (+86.9%); Honda 57,511 units (+41.0%); and Suzuki48,349 units (+37.5%).

 

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