JAKARTA: Car sales in Indonesia leapt 24.2 percent year-on-year in February as increased supply met pent-up demand among consumers in Southeast Asia's largest economy.
Sales of cars in February rose to 86,407 cars, led by Toyota, Daihatsu, Mitsubishi, Suzuki, and Nissan, according to data from the Indonesia's Automotive Manufacturers Association (Gaikindo) on Friday.
Sales of cars and motorbikes are an important indicator of consumption in Indonesia, a country with 6.5 percent growth in 2011 and a rapidly expanding middle class.
On a monthly basis, domestic car sales grew 13.2 percent, said the association and revised January sales to 76,365 cars. Average car sales growth in 2011 stood at 18.2 percent.
"It's more about supply issues. Toyota has delivered its new variant to consumers and Honda has started to recover after supply disruption from Thailand," Adrian Joezer, analyst at Mandiri Sekuritas told Reuters on Friday.
Data from Indonesia's main auto assembler PT Astra International Tbk showed that Toyota sold a total of 33,593 cars in February and grew 15 percent from a month earlier. Sales of Honda rose 22.6 percent month-on-month in February to 1,904 cars.
On Friday, the government and Bank Indonesia issued regulations that set minimum down payments for loans of private cars and motorbikes, both for banks and multifinances.
The regulations came a week after the government proposed a fuel price hike plan to parliament to help the state cope with the rising cost of subsidies amid increasing crude oil prices.
"Most of the consumers are first time buyers. In 2008, when fuel was hiked by 30 percent, the impact was only for a month and then rebounded afterwards," said Joezer, adding that buyers of cars are more sensitive to financing liquidity issues.
Last year the country booked a new sales record of 894,180 cars, up 16 percent from 2010.
"The issue of rising lending rates will give negative sentiment. In February, consumers were still waiting to see the impact of fuel policies," said Akhmad Nurcahyadi, an analyst at Jakarta-based BNI Sekuritas.
The worries about increasing transportation costs will likely be seen after the implementation of the new fuel policy and could affect sales in March or April, said Nurcahyadi.
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