AUTOMOTIVE INDUSTRY RESUMES VIGOR; IMPORTED CARS COLOR COMPETITION LANDSCAPE.

Indonesian Commercial Newsletter, May, 2000

Shortly after 1998, the automotive industry started to show some vigor. Throughout 1999, the domestic market absorbed as many as 93,814 units, up 60.9% from the previous year. This phenomenon is quite interesting, given that Indonesian economy has not moved completely out of the crisis and that there has not been a significant improvement in the people's purchasing power.

The 1999 automotive deregulation has encouraged importer-dealers to import cars in CBU condition into Indonesia, and these include non-luxury ones. Despite the high import duty on cars, automotive importer-dealers are enthusiastic about doing their business. Although the market segment for imported cars is limited, opportunities for profit still exist, more so because the margin so far enjoyed...