Automotive Sales Dip in May Despite Tax Incentives

While EV sales have increased thanks to tax incentives, overall car sales have decreased. Car manufacturers are placing their hopes on GIIAS to create momentum for sales and rejuvenate the market.

Nuhansa Mikrefin Yoedo Putra

11 Jun 2024 - 18.42
A-
A+
Automotive Sales Dip in May Despite Tax Incentives

Illustration - Atmosphere at the GIIAS automotive exhibition./Bisnis

Bisnis, JAKARTA — Government incentives seem to be unsuccessful in headwinds faced by the automotive market as car sales in May are down compared to May last year.
 Wholesale car sales in May reached 71,263 units, down 13.3 percent from 82,189 units year-on-year (YoY). Retail sales, at 72,137 units, are also down by 12.6 percent from 82,560 units. From January to May, wholesale sales reached 334,969 units, down 21 percent YoY from 423,771 units, while retail sales were down 14.4 percent from 422,514 to 361,698 units.
 "Economic growth that has yet to recover is one of the factors for the sluggish automotive market throughout January-May 2024," said Jongkie Sugiarto, Co-Chairman I of the Association of Indonesian Automotive Manufacturers (Gaikindo), Monday (6/10/2024).
 Indonesia's economic growth in Q1/2024 was recorded at 5.11 percent YoY, the highest since 2019. On the other hand, Bank Indonesia’s (BI) key interest rate, which rose by 25 basis points to 6.25 percent, serves as a headwind for the automotive industry as banks and financing institutions raise their loan rates.
 Meanwhile, the rupiah’s exchange rate against the dollar also reached a four-year low on June 5, 2024, at IDR16,293 to the dollar—the lowest since April 2020.
 Despite the market’s numerous challenges, Gaikindo maintains its optimistic car sales projection of 1.1 million units in 2024. "However, we will continue to monitor in the coming months," Jongkie said.
 Much hope is placed on the Gaikindo Indonesia International Auto Show (GIIAS) slated July 18–28, 2024. Anton Suwandy, marketing director at PT Toyota-Astra Motor (TAM), hopes the event can stimulate sales and rejuvenate the market.
"We at Toyota are certainly hoping for the market conditions to improve until the end of the year, and we have also prepared various innovations in new models," he told Bisnis Monday (6/10/2024).
 He added that despite the year-on-year decline, May’s market grew from April. This is reflected in Toyota's retail car sales, which rose by about 23 percent. Domestic retail sales also reached 72,137 units in May, up 22.7 percent from 58,788 units in April. "Yes, the hope is [for GIIAS] to add momentum for the automotive market," he said.
 The same sentiment was expressed by Bob Azam, vice president director at Toyota Motor Manufacturing Indonesia (TMMIN). "Even amid the sluggish market, we at the factory strive to maintain production. In total, production days remain the same, which is 245 days," he said.



EV INCENTIVES
 The government has launched incentives to boost the automotive market, mostly aimed at electric vehicles. According to the Supreme Audit Agency (BPK), Hyundai and Wuling EVs received government-borne VAT incentives reaching IDR685.79 billion in 2023.
 Specifically, the Hyundai Ioniq 5 benefited from IDR477.06 billion in incentives, calculated at a dealer price of IDR800 billion for 6,698 units sold between April and December 2023.
 Trailing behind is the Wuling Air EV, which received IDR208.733 billion, with a dealer price of IDR300 billion for 7,815 units sold in the same period.
 Hyundai Ioniq 5 and Wuling Air EV have met the requirements to be eligible for the incentives, with at least 40 percent of the components locally sourced. Hyundai’s Ioniq 5 is 50 percent local, while Wuling’s Air EV is 40.04 percent.

Cek Berita dan Artikel yang lain di Google News dan WA Channel
Editor: Yusuf Waluyo Jati
Jelajahi peluang bisnis terpercaya dengan berlangganan
Temukan keleluasaan dan keuntungan maksimal dengan pilihan paket berlangganan eksklusif ini
BERLANGGANAN SEKARANG
Tidak Memerlukan Komitmen, Batalkan Kapan Saja
Penawaran terbatas. Ini adalah penawaran untuk Langganan Akses Digital Dasar. Metode pembayaran Anda secara otomatis akan ditagih di muka setiap empat minggu. Anda akan dikenai tarif penawaran perkenalan setiap empat minggu untuk periode perkenalan selama satu tahun, dan setelah itu akan dikenakan tarif standar setiap empat minggu hingga Anda membatalkan. Semua langganan diperpanjang secara otomatis. Anda bisa membatalkannya kapan saja. Pembatalan mulai berlaku pada awal siklus penagihan Anda berikutnya. Langganan Akses Digital Dasar tidak termasuk edisi. Pembatasan dan pajak lain mungkin berlaku. Penawaran dan harga dapat berubah tanpa pemberitahuan.
BIG MEDIA
Jalan K.H. Mas Mansyur No. 12AKaret Tengsin - Jakarta Pusat 10220
© Copyright 2024, Hak Cipta Dilindungi Undang - Undang.
BIG MEDIA
Jalan K.H. Mas Mansyur No. 12AKaret Tengsin - Jakarta Pusat 10220
© Copyright 2024, Hak Cipta Dilindungi Undang - Undang.