Gaikindo Revises Car Sales Target To 850,000 Units

Saturday, 26 Oct 2024

By ferry@insightinnews.com

The Indonesian Automotive Industry Association (Gaikindo) has officially revised its annual car sales target from 1.1 million units to 850,000 units. The decision to adjust the target comes in response to the current economic conditions and the declining public purchasing power, which has been evident since the beginning of the second semester of 2024.

Yohannes Nangoi, the Chairman of Gaikindo, announced the revision of this year's sales target from 1 million units to 850,000 units. "This year's target is set at only 850,000 units, down from 1 million," Nangoi emphasized during the GIIAS Semarang exhibition on Wednesday, October 23, 2024.

Nangoi explained that this decision was based on discussions within Gaikindo. "I have discussed this matter with my colleagues at Gaikindo," he stated. With the new target in place, the association hopes that the domestic automotive industry can accelerate and begin to shift towards a positive trend. However, when examining the sales performance of four-wheeled vehicles over the past five years, this annual target appears somewhat pessimistic.

This target is lower than the recovery period following the Covid-19 pandemic in 2021, when total wholesale car sales reached 887,200 units, while retail sales amounted to 863,359 units. From January to September 2024, total wholesale car sales recorded 633,218 units, with retail sales at 657,223 units.

Nangoi elaborated on the reasons behind Gaikindo's decision to revise the target, citing several influencing factors. "The automotive sector is currently experiencing contraction, primarily due to significant political agendas. People are hesitant to purchase cars when the situation is unstable. Once stability is achieved post-election, everything will be fine," he explained.

The second point is that interest at the beginning of the year was significantly high, although it has decreased somewhat since then. The third point is that the exchange rate has fluctuated considerably, not just in Indonesia, but also in Thailand, which has seen the most significant decline. Therefore, I believe the situation remains quite normal, and we hope for a recovery next year, he added.

This decline is attributed to the decreasing purchasing power of the Indonesian population. Additionally, the economic conditions are contributing to the downturn in the automotive industry. "Purchasing power is influenced not only by the presidential election but also by the overall economic situation, which appears to be experiencing a slight slowdown. We hope for a recovery," he stated.

To boost sales by the end of the year, Nangoi revealed several programs that are expected to enhance sales in the remaining two months. "One of these initiatives is the ongoing exhibitions we are holding. We will also have a final major exhibition called Gaikindo Jakarta Auto Week, where we will offer significant discounts at the end of the year," Nangoi explained.

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