A look at the potential of Indonesia's growing automotive industry. Comparing with ASEAN countries, TIV for last 5 years, Brands, Passenger Cars vs Public Vehicles

1. Outlook:
Indonesia
Automotive
Industry

2. Indonesia’s Automotive Industry – A glance
https://www.slideshare.net/ulikaiser/indonesia-autobook-2019-preview
250 million
inhabitants
disseminated over
17,000 islands
4th most
populous
nation in the
world
The largest economy
in the Association
of South-Asian
Nations (ASEAN)
representing 40% of
its GDP and
population
The export of
automotive
components
increased 13
times from 6.2
million
components in
2016 to 81
million
components in
2017.
Java represents 70% of national
new vehicle sales, including 24%
in the Jakarta province alone.
The entirety of the
automotive activity in the
country is concentrated in
Jakarta or around in West
Java.

3. Indonesia’s Automotive Industry – A Glance
https://www.slideshare.net/ulikaiser/indonesia-autobook-2019-preview
Passenger car sales
Indonesia reached
824,901 passenger
cars and 1.216
total four-wheeled
vehiclesValue of investments
in Indonesia’s
automotive industry
is expanding by 10-
12% or more than USD
4.3 billion
MPVs and SUVs are
to Indonesia what
pick ups are to
Thailand,
representing two-
thirds of local
sales and
production70% of automotive parts still
need to be imported, a situation
that is supposed to change with
the Low Cost Green Car program
Production target for 2020 is
1.5 million units

4. The Region : Indonesia in ASEAN
Indonesia :
The second-largest
car manufacturing
nation in
Southeast Asia and
the ASEAN region
(trailing rather
far behind
Thailand that
controls about
half of total car
production in the
ASEAN region)..https://www.slideshare.net/ulikaiser/asean-automotive-roadmap-2020

5. The Region : Indonesia in ASEAN
Indonesia :
• Biggest car market
in Southeast Asia
and ASEAN.
• Accounts for about
one-third of total
annual car sales
in ASEAN
• However, the
growth of car
sales in Indonesia
falls below ASEAN
average growth forhttps://www.indonesia-investments.com/business/industries-sectors/automotive-industry/item6047
Country
2014 to
2015
2015 to
2016 2016 to 2017
Average Growth From
2014-2017
Singapore 0.66 0.41 0.05 0.3712
Vietnam 0.57 0.29 -0.07 0.2620
Philippines 0.23 0.25 0.18 0.2197
ASEAN -0.04 0.03 0.05 0.0153
Thailand -0.09 -0.04 0.13 0.0007
Indonesia -0.16 0.05 0.02 -0.0322
Malaysia 0.00 -0.13 -0.01 -0.0452
Brunei -0.20 -0.08 -0.15 -0.1463

6. The Region : Indonesia in ASEAN
Indonesia :
• In 2018, the
growth of motor
vehicles sales is
6.6% from 2017,
slightly below
ASEAN’s average of
6.7
http://www.asean-autofed.com/files/AAF_Statistics_ytd_dec2018.pdf
ASEAN MOTOR VEHICLE SALES : JANUARY - DECEMBER 2018

7. The Region : Indonesia in ASEAN
Indonesia :
• Indonesia’s car
density forecast
for 2021 is only
1/3 of Thailand’s
and close to 1/5
of Malaysia’s.
• Should other
conditions be
fulfilled, such as
increased demand,
economy of
citizens etc,
ASEAN CAR DENSITY FORECAST :2013-2021
https://www.slideshare.net/ulikaiser/asean-automotive-roadmap-2020

8. Indonesia’s Automotive Industry – Car Sales YoY
https://tradingeconomics.com/indonesia/car-registrations
Car Registrations in
Indonesia averaged
57,532.33 from 1999
until 2019, reaching
an all time high of
115,974 in September
of 2013 and a record
low of 1898 in
January of 1999.
The long term trend
for the last 20
years is positively
upwards but the
great volatility in
recent years meant
businesses involved

9. Indonesia’s Automotive Industry – Car Sales and GDP
https://www.indonesia-investments.com/business/industries-sectors/automotive-
industry/item6047
2007 to 2012, the
Indonesian economy
grew at least 6.0
percent per year,
with the exception
of 2009 when GDP
growth was dragged
down by the global
financial crisis.
In the same period,
Indonesian car sales
climbed rapidly, but
also with the
exception of 2009
when a steep decline

10. Indonesia’s Automotive Industry – GDP 2012-2022
https://www.statista.com/statistics/320142/gross-domestic-product-gdp-in-indonesia/
GDP is an important
indicator of a
country's economic
power. In 2017,
Indonesia's gross
domestic product
amounted to around
1,015.41 billion
U.S. dollars.
In 2020, Indonesia’s
GDP is predicted to
be at 1,175.08
billion US dollars.

11. Indonesia’s Automotive Industry – Cities
https://www.ipsos.com/sites/default/files/2016-09/indonesia-automotive-industry-outlook-
2020.pdf
• With GDP forecasted
to reach USD 1.3
trillion in 2020,
large urban centers
will emerge driving
a more balanced
growth and
providing new
opportunities.
• Java, with half of
the Indonesian
population, will
remain the economic
and political
center of
Indonesia,
accounting for over

12. Indonesia’s Automotive Industry – Cities
https://www.asiagreen.com/en/news-insights/indonesia-s-second-tier-cities-on-the-move
• By 2030, it is
expected that
there will emerge
a large number of
cities with a
population of at
least 2 million
(as a comparison
Europe has
currently only 10
such cities).
• The map also shows
that many cities
are expected to

13. Indonesia’s Automotive Industry – Urbanisation & New Consumers
• Urbanization could
reach 70% by 2030,
which will require
significant
infrastructure
development and other
investment to support
growth of the smaller
cities that will
integrate the new
urban citizens.
• With a share of
roughly 30% of total
population, smaller
cities, defined as
having a population
between 150,000 andhttps://www.ipsos.com/sites/default/files/2016-09/indonesia-automotive-industry-outlook-2020.pdf

14. Indonesia’s Automotive Industry – Brands
Toyota
33%
Daihats
u…
Suzuki
13%
Honda
13%
Mitsubishi
12%
Nissan
3%
Hino
3%
Isuzu
2%
Datsun
1%
Ford
1% OTHERS
4%
https://www.gaikindo.or.id/en/indonesian-automobile-industry-
data/
Toyota
31%
Daihatsu
17%
Honda
14%
Mitsubishi
Motors
13%
Suzuki
10%
Mitsubishi
Fusho
4%
Hino
4%
Isuzu
2%
Wuling
1%
Datsun
1% OTHERS
3%
Retail Sales 2018Retail Sales 2014
• Market leaders remain the same in the last 5 years : Daihatsu with the
lion share, followed by Daihatsu, Suzuki, Honda and Mitsubishi.
• Ford Motor Indonesia, exited Indonesia earl7 2017 as the company found
it too difficult to compete with Japanese counterparts
• Chinese automakers cut in on Japanese rivals in Indonesia (Wuling) woo
younger drivers by offering more for less
https://www.indonesia-
investments.com/id/business/business-
columns/automotive-sector-ford-cars-to-return-on-the-
streets-of-indonesia/item8264
https://asia.nikkei.com/Business/Business-trends/Chinese-
automakers-cut-in-on-Japanese-rivals-in-Indonesia

15. Indonesia’s Automotive Industry – Brands - Toyota
• PT Toyota-Astra Motor
(TAM) is a holder of
APTM ( Agen Tunggal
Pemegang Merk)
• TAM : joint venture
between PT. Astra
International Tbk (50%
)share & Toyota Motor
Corporation (50%)
• In 1977 produced and
sold the "Kijang",
multipurpose van
developed for
Indonesian consumerhttp://www.toyotaindonesiamanufacturing.co.id/corporate/company-milestone https://id.wikipedia.org/wiki/Toyota-Astra_Motor
https://scholar.harvard.edu/files/tnkomo/files/analysis
_of_toyota.pdf

16. Indonesia’s Automotive Industry – Brands - Toyota
• Toyota’s sales have increased
significantly in the period 2000 to
2011, from 18.6% to 45%
• From 2008 to 2012, sales have more
than doubled from 199,000 units to
409,000 units
• In 2012, four of the top ten best-
selling cars in Indonesia are
Toyotas, with the Toyota Avanza
taking the clear lead.
• The success of Toyota in Indonesia
can be attributed to its “Innovative
International Multi-Purpose Vehicle”
strategy launched in 2003.
• Toyota announced that it plans to
invest an additional $1.3 billion
over the next five years, inhttps://scholar.harvard.edu/files/tnkomo/files/analysis_of_toyota.pdf

17. Indonesia’s Automotive Industry – Brands - Daihatsu
• PT Daihatsu Indonesia-
joint venture between
Japanese holding
company (30%) & PT
Astra International
(70%)
• PT Daihatsu Indonesia
were distributing
Daihatsus while
assembly was carried
out by Gaya Moto
• Daihatsu's Hijet was
very popular in
Indonesia, especially
https://en.wikipedia.org/wiki/Automotive_industry_in_Indonesia

18. Indonesia’s Automotive Industry – Brands - Honda
• PT Honda Prospect Motor
(HPM), Honda Motor's
automobile subsidiary
was established in 1999
as the sole agent and
manufacturer of Honda
cars
• The company began
automobile production
in 2003 after building
its first factory in
Karawang.
• Increasing demand led
to a second factory in
https://www.just-auto.com/news/honda-indonesia-assembler-marks-20-years-operation_id187939.aspx

19. Indonesia’s Automotive Industry – Brands - Suzuki
• PT. IndoMobil Suzuki
International - joint
venture between Suzuki
Motor Corporation and
the IndoMobil Group.
• Their first products
were the ST10 Carry and
Fronte LC20 of 1976.
The Carry (soon
replaced by the ST20)
saw extensive use as an
‘Angkot’
• Suzuki's sales rose
exponentially in thehttps://en.wikipedia.org/wiki/Automotive_industry_in_Indonesia#cite_note-pisang45-8

20. Indonesia’s Automotive Industry – Luxury Cars
• Mercedes Benz and BMW
lead luxury vehicle
sales due to the
overall brand awareness
within their target
segment, a portfolio
covering almost all PV
segments, in addition
to a fairly well
established dealership
network
• Prestige and comfort
are key attributes for
consumers of luxury
vehicleshttps://www.ipsos.com/sites/default/files/2016-09/indonesia-automotive-industry-outlook-2020.pdf
• Western brand of cars are only popular
for the luxury car market

21. Indonesia’s Automotive Industry – Passenger Cars and Commercial Vehicles
• Ratio of Passenger Cars to
Commercial vehicles have
steadily risen and a sharp
spike in 2017
• Many factors take place for
the ratio to increase but a
high possibility is more
focus are given towards
passenger cars (higher profit
margin), public policy on
rail roads by the Government
and a higher income of
population
https://knoema.com/OICAWMVSCT2015/world-motor-vehicle-sales-by-country-and-type
• The Growth YoY% comparison between
Passenger Car vs Commercial vehicle shows
that there is no large different in % of
growth between them
• In some years (2012-2016) growth in
commercial vehicles overtake growth in
passenger cars as demand is higher but in
2017 it goes back to normal

22. Indonesia’s Automotive Industry – Commercial Vehicle Sales in Asean
• Indonesia has the highest
YoY% for commercial vehicle
growth at 19.6% in ASEAN
countries in 2018
• Over the next five years the
passenger vehicle segment
will remain very attractive,
while growth of the
commercial vehicle segment
will be slower:
• Passenger vehicle (PV)
growth is estimated at CAGR
6.8% to 2020
• Motorcycle (MC) growth is
estimated at CAGR 4.8% to
2020
• Truck growth is estimated at
CAGR 3.5% to 2020
• Bus growth is estimated at
http://www.ipsosconsulting.com/pdf/special-report-the-asean-auto-industry.pdf
2017 2018 YoY %
Others 417 460 10.31
Malaysia 62 60 -3.23
Indonesia 235 281 19.57
Thailand 472 500 5.93
https://www.ipsos.com/en/opportunities-and-challenges-
indonesias-automotive-industry
As infrastructure accelerates in
Indonesia in its major cities, demand
for commercial vehicles will increase

23. Indonesia’s Automotive Industry – Summary
http://www.ipsosconsulting.com/pdf/special-report-the-asean-auto-industry.pdf
• Exports have risen in recent years, and untapped potential remains
a big selling point.
• Ownership rates remain low, however, with a growing middle class,
the number is set to grow
• the Japanese OEMs rule the Indonesian market. Toyota leads,
accounting for over half of domestic vehicle sales in 2017.
• Both GM and Ford failed in Indonesia because both didn’t have local
manufacturers, a critical factor to produce cheaper vehicles
• Challenging the status quo requires significant investment, strong
market understanding, and a long term view with regards to return
on investment.
• Spending power in Indonesia may be rising, but with the average GDP
per capita under US$4,000, affordability remains an essential
consideration.
• Successful Japanese companies have shown that the way to success is
to have joint ventures with local companies and to share the
profit. Indonesian Government are now desirous to keep the profit
inside the country thus foreign companies must prove their ability