Automotive Industry Indonesia: Sales, Production, Export & Import

Indonesia's Industry Ministry targets to see the export of at least 20 percent of car units that are manufactured in Indonesia. Considering Indonesia produced a total of 1,216,615 car units in 2017, while exporting 231,169 units that same year, the ratio stands at 19 percent, just below the ministry's target.

Production capacity is not an issue in Indonesia's automotive industry. After several companies have been investing in expansion of their manufacturing plants in recent years, while there have also arrived some newcomers (although some others closed their plants in Indonesia), the country's total installed annual car production capacity has now reached an estimated 2.25 million. In fact, Indonesia's car production capacity surged 70 percent over the past six years.

These production expansion plans of the nation's car manufacturers are primarily encouraged by the still low per capita car ownership ratio of Indonesia. And although domestic car sales figures have been stagnating in recent years (a phenomenon that is usually attributed to the country's bleak growing purchasing power) there is still ample room for car sales growth in Indonesia in the future.

A major problem in terms of car exports is that Indonesia's car shipments can currently only reach developing nations, such as its peers in the Southeast Asian region, South America and Africa, as well as the Middle East. The reason behind this is that these countries have not set high standards for safety and gas emissions.

Indonesia also lags behind, rather far, in terms of safety and gas emissions regulations. Through Environment and Forestry Ministry Regulation No. P. 20/MENLHK/SETJEN/KUM. 1/3/2017 on the Standard Exhaust Emission of Euro 4-Type Motor Vehicles, published on 10 March 2017, the Indonesian government orders all domestic manufacturers of four-wheeled motorized vehicles to adjust to the Euro-4 emission standard. The Indonesian government announced that it would provide an 18-month period to local car or bus manufacturers to adjust to the new standard, while diesel vehicles were given four years to adjust. Currently, most automotive manufacturers in Indonesia are still in the Euro-2 phase.

While several advanced nations already started to use the Euro-2 standard back in 1997, Indonesia only followed suit in 2003 (while the Euro-2 standard fuel is still not widely used around the Archipelago today as many Indonesians are still using RON 88, also known as premium). And while advanced nations started to comply with the Euro-4 standard since 2005, Indonesia is barely ready to introduce it in 2018.

Read also: Indonesia's Automotive Industry

Indonesian Industry Minister Airlangga Hartarto added that most advanced economies have adopted the standard that is formulated in the United Nations Economic Commission for Europe (UNECE), while Indonesia is yet to adopt this and therefore misses opportunities in terms of car exports. In 2017 the Indonesian government already decided to adopt the UNECE and make it the reference for the National Indonesian Standard (in Indonesian: Standard Nasional Indonesia, or SNI) for a selection of car components, including tires and windows. However, it is a process that is still underway.

Meanwhile, car imports into Indonesia have been declining over the past five years. This can possibly be explained by the launch of various good quality and attractive car models by domestic car manufacturers on the domestic market, hence limiting demand for imported cars.

Car Data Indonesia:

	2013	2014	2015	2016	2017	5-Year Trend
Car Sales (car units)	1,229,916	1,208,019	1,013,291	1,061,859	1,079,886	↓
Car Production (car units)	1,208,211	1,298,532	1,098,780	1,177,797	1,216,615	=
Car Export (car units)	170,958	202,273	207,691	194,397	231,169	↑
Car Import (car units)	153,920	104,503	88,995	75,571	88,683	↓

^{Source: Gaikindo}

Domestic Car Sales in Indonesia (CBU):

Month	Sold Cars    2018	Y/Y Growth
January	95,892	+11.2%

 

Month	Sold Cars    2013	Sold Cars    2014	Sold Cars    2015	Sold Cars    2016	Sold Cars    2017
January	96,718	103,609	94,194	85,002	86,262
February	103,278	111,824	88,740	88,208	95,163
March	95,996	113,067	99,410	94,092	102,335
April	102,257	106,124	81,600	84,770	89,624
May	99,697	96,872	79,375	88,567	94,085
June	104,268	110,614	82,172	91,488	66,389
July	112,178	91,334	55,615	61,891	85,354
August	77,964	96,652	90,537	96,282	97,256
September	115,974	102,572	93,038	92,541	87,696
October	112,039	105,222	88,408	92,106	94,433
November	111,841	91,327	86,938	100,365	96,191
December	97,706	78,802	73,264	86,547	85,098
Total	1,229,916	1,208,019	1,013,291	1,061,859	1,079,886

^{Source: Gaikindo}

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