Indonesia's Largest Car Market in ASEAN

Indonesia's automotive industry is experiencing rapid growth. This is evident in 2017, when Indonesia became the largest automotive market in Southeast Asia (ASEAN). A total of 1.1 million units, or 33% of ASEAN's car sales, were sold in Indonesia. This high sales volume of four-wheeled vehicles or more is driven by Indonesia's relatively stable economic growth of around five percent. Furthermore, Indonesia's vast territory also supports high national automotive demand.

The increasing number of middle-to-high-income earners, in line with Indonesia's GDP (per capita) growth, has fueled the public's ability to purchase new cars. The domestic economy, still growing at over 5%, provides positive sentiment for the national automotive market. For information, Indonesian car sales in the first half of 2018 grew by 3.8% to 553,757 units compared to the same period the previous year, which saw 533,506 units sold.

The government hopes that Indonesia will not only dominate sales but also become the largest automotive producer in ASEAN, surpassing Thailand. As is known, Indonesia's car production in 2017 reached 1.17 million units. This figure is below Thailand's car production, which reached 1.94 million units. Domestic car production in the first half of this year amounted to 624,000 units, while Thailand has already reached 1.1 million units.

(Read Databoks: What is the Value of Indonesian Car Exports?)