Green Cars Keep Indonesia February Sales in Black

Indonesia’s new-car sales rose 8.2% in February to 111,765 units, driven higher by demand for low-cost green cars and boosting the industry’s hopes of achieving 1.2 million deliveries this year.

The result came after January sales increased 7.0% to 103,510 units and left the year-to-date total up 7.6% to 215,277.

Dutch-owned development company Indonesia Investments says low-cost green cars, introduced on Indonesia's market in 2013, accounted for about 15% of total sales in February.

Through tax incentives, the Indonesian government stimulated establishment of the LCGC industry in Indonesia, including a requirement automakers meet fuel-efficiency targets.

“With an average price tag of around 100 million rupiah ($8,850), these LCGCs proved highly popular on the Indonesian market,” Indonesia Investments says.

The five principal car brands participating in the program are the Astra Toyota Agya, Astra Daihatsu Ayla, Suzuki Wagon R, Honda Brio Satya and Datsun Go.

Indonesia Investments says business consulting firm Frost & Sullivan expects local LCGC sales will grow 125% to 125,000 units this year.

Association of Indonesian Automotive Industries Deputy Chairman Johnny Darmawan tells the Jakarta Globe newspaper the industry is aiming to sell 1.2 million units this year after record deliveries of 1,122,901 units in 2013, but he expects moderating sales during and after general elections in April and July.

“It all depends on the result, who is elected,” he says. “If the election runs smoothly, auto sales would rise.”