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Frost & Sullivan Forecasts Indonesia's 2015 Vehicle Sales to Grow 5% to Reach 1.268 million units

From The Jakarta Globe
February 28, 2015

Total vehicle sales in Indonesia potentially grow by 5 percent year-on-year to reach 1.268 million units in 2015, expected by Frost & Sullivan. It mainly driven by infrastructure development spending by the Government and higher purchasing power from the middle class population.

Mr. Vivek Vaidya, Vice President, Automotive & Transportation Practice, Asia Pacific at Frost & Sullivan said that the estimated stable growth of the Indonesian economy at 5.5 percent this year will also help drive vehicle sales.

However, he added that the global economic uncertainty is likely to have a significant impact on the automotive sector as imports of both parts or components and completely built-up (CBUs) will become more expensive. "The increase in cost of automotive imports could have a significant impact as high value parts and aggregates are still imported for many models," he said.

The imported CBUs particularly luxury cars are likely to become more expensive, he said. LCGC cars will be least impacted due to a high degree of localization, he added. Mr. Vaidya said that the evolution of ASEAN Economic Community (AEC) is likely to be a game changer for the regional industry, with impact across the value chain.


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