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utomakers are confident of reaching their target of selling 1.2 million cars in the domestic market this year, up by 10 percent on last year. For the second quarter, automakers anticipate car sales will reach around 300,000 units, more or less similar to the number achieved in the first three months of the year, and this will keep the full-year sales target on track, Indonesian Automotive Industry Association (Gaikindo) secretary-general Juwono Andrianto said on Monday.

'€œSo far, we see no regulation or other factors that will significantly affect sales in the upcoming months, except an increase in fuel prices,'€ he told The Jakarta Post.

As the country deals with fuel subsidies, the government aims to soon introduce one of the two feasible policy options '€” raising the price of subsidized fuel or restricting consumption of subsidized fuel '€” currently under consideration.

Sales of cars, a key indicator of consumption in Southeast Asia'€™s biggest economy, surged by 17.97 percent to 295,909 units in the January-March period this year, buoyed by Indonesia'€™s emerging middle class who have switched from buying motorcycles or used cars to new cars.

Statistics from Gaikindo suggest that in the first three months of this year, several players began to gain traction in the market as indicated by growth in sales.

Honda Prospect Motor (HPM), a joint venture between Japan'€™s third-biggest automaker Honda Motor Co. and Indonesia'€™s Prospect Motor, recorded the biggest growth rate of 228.77 percent to 26,772 units from last year. Honda gained its highest sales for its hatchback, the Jazz, while other models such as its city car, the Brio, and sports utility vehicle, the CR-V, also contributed significantly to its quarterly sales.

Fourth-biggest seller, Suzuki Indomobil Sales (SIS) which sells Suzuki vehicles, also saw marked growth of 70.41 percent to 36,237 units in the first three months of this year, particularly supported by its multi-purpose vehicle the Ertiga, which since its launch last year has challenged the dominance of the Toyota Avanza and Kijang Innova as well as Daihatsu'€™s Xenia in the domestic market.

Toyota Astra Motor (TAM), the top seller, saw its sales increase by 8.25 percent to 104,073 units in the quarter from the past year, whereas Astra Daihatsu Motor'€™s (ADM) sales rose by only 5.23 percent to 42,197 units at a time when the overall market was up more than 10 percent.

ADM president director Sudirman Maman Rusdi said that in the upcoming months, the firm might see a further decline in its market share due to a shortage of supply and a delay in the introduction of new incentives for low-cost green car production.

'€œOur market share target for this year is 15 percent, declining from 16 percent last year, as we still cannot roll out the Ayla,'€ he said.

Daihatsu is struggling hard to meet market demand for its models. Its old Karawang plant is producing at its maximum capacity, while additional supply cannot be provided as its new plant is designed to produce its low-cost and eco-friendly car, the Ayla and another model it is jointly developing with Toyota, the Agya.

Local players have been awaiting new rules that will detail government incentives for manufacturers of low-cost and green automobiles, which analysts say could help expand further the local market.