New vehicle sales in Indonesia continued to plunge in August 2020, by almost 59% to 37,291 units from 90,568 units in the same month of last year, according to member wholesale data compiled by industry association Gaikindo.

The global COVID-19 pandemic has taken a heavy toll on the economy so far, both in terms of domestic consumption, investment and exports. GDP shrank by 5.3% in the second quarter following growth of just under 3% in the first quarter, after the government imposed widespread business and social restrictions in March which it began to gradually lift in May.

But with infections nationwide still on the rise, any hopes for a quick economic rebound have been dashed. The capital city Jakarta went back into semi-lockdown in mid-September, further denting consumer and business sentiment, while international travel restrictions continue to affect the country's hospitality and tourism sectors.

The central bank cut its benchmark interest rate by a further 25 basis points in July to help stimulate domestic consumption, bringing the rate down to 4% from 6% last year.

Vehicle sales in the first eight months of 2020 were down by over 51% at 323,507 units compared with 661,919 in the same period of last year, with deliveries in the second quarter plunging by almost 90% to 24,042 units.

Sales of passenger vehicles fell by over 52% to 243,154 units year to date, while sales of trucks and buses were down by over 47% at 80,353 units.

Toyota reported a 54% decline in wholesale volumes to 97,728 units year to date, followed by Daihatsu with an almost 50% drop to 57,978 units, Honda 43,832 units (-48%), Suzuki 38,656 units (-39%) and Mitsubishi Motors 34,704 units (-58%).

Gaikindo said it was in the process of revising down its full year sales forecast further from its current forecast of 600,000 units (-40%), to take into account the worsening COVID-19 pandemic in the country.