New vehicle sales in Indonesia fell by 5.5% to 93,990 units in March, from 99,400 units a year earlier, according to local reports citing Astra International – the country's largest vehicle distributor.
The market has been in decline since the second half of 2014, reflecting slowing economic growth as commodity prices weakened sharply, exports declined and interest rates were hiked.
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Vehicle sales last year fell over 16% to 1,013,300 units, from 1,208,000 units in 2014.
Sales in the first quarter of 2016 fell by a further 5.4% to 267,300 units, compared with 282,300 units in the same period of last year, despite signs of a pick up in economic activity.
Economic growth accelerated moderately in the first quarter, to just over 5% from 4.7% in the whole of 2015, reflecting higher private and public sector investment – particularly in infrastructure and other construction projects.
Bank Indonesia also has cut its benchmark interest rate three times since the beginning of the year, to 6.75%, to help stimulate domestic consumption.
