Unlike most products on the market, motorcycle sales are likely to weather the pressure from a fuel price rise and may even have to revise up their sales target, market players say.
The Indonesian Motorcycle Industry Association (AISI) projected sales of 5.2 million units this year, up from 4.69 million last year.
Indonesia is the third largest market for motorcycles in the world, after China and India.
Publicly listed automotive financing manager and dealer Tunas Ridean said the fuel price increase would in fact force car and public transport users to rely on motorcycles as they are more cost efficient.
Managing director Rico Setiawan said he expected the company's motorcycle sales to grow by 22 percent and that new financing under its subsidiary, Tunas Finance, to grow by 33 percent to Rp 2.4 trillion by the end of the year.
Motorcycle producer PT TVS Motor Company Indonesia is still optimistic about increasing its penetration in Java and Sumatera.
The Indian based company invested in building a factory in Karawang in July, which is estimated to be worth US$45 million.
TVS director Simha said the factory was aiming to produce 300,000 units per year, 50,000 for domestic consumption and the rest to be exported to countries throughout Asia.
The company, he said, was seeking to rank third after Japan-based Honda and Yamaha in terms of quality and price competitiveness.
TVS Indonesia has already produced 4,500 motorcycles this year and sold 3,700 units.
"We surveyed Indonesian market expectations two years ago before producing the products," said Simha, saying competition was fierce here.
The factory produces two motorcycles especially for the domestic market: the TVS Neo 110 cc motorcycle and the TVS Apache RTR 160 cc sports motorcycle.
They are designed to suit Indonesian people's body size and suitable to weave in and around a traffic jam, director sales and marketing K. Vijaya Kumar said on the company's website.
The Indonesian factory is the TVS Motor Company's only plant outside India.
"The plant will continue to grow until 2011 and is later expected to produce up to one million motorcycles annually," said Simha.(rff)