From Government of Indonesia

2006 Auto Sales Down 40%

Sales of new vehicles in Indonesia plunged 40% in 2006, figures from the industry association showed Monday (15/1/07).

Auto sellers felt the pinch due to higher interest rates, which were jacked up in 2005 in the wake of a spike in inflationary pressure stemming from dramatic fuel price hikes. The government also slashed subsidies on domestic fuel amid soaring global oil prices, another deterrent for consumers buying cars.

Domestic car sales totaled 318,883 in 2006, down 40%, a report by the Indonesian Automotive Industries Association showed, according to Agence France-Presse. The figure was slightly below the association's forecast of 320,000.

Vehicle sales appear to be on the road to recovery after the 49% fall recorded in the first half of 2006. The report noted that in December alone, industry-wide sales totaled 31,166 vehicles, against 32,870 a year earlier.

Motorcycle sales were far more buoyant, falling only 12.16% to 4.47 million units in 2006 from 5.09 million units the previous year, the Association of Motorcycle Producers (AISI) said.

The decline was the first in eight years. Sales crossed the 1 million level in 2001 and continued to scale up to new peaks and reached an all-time peak of more than 5 million units in 2005.
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