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ajor automotive distributor PT Indomobil Sukses Internasional (IMAS) will be on the lookout for significant industry changes in the second half of the year, due to higher fuel prices and borrowing costs.

Borrowing costs for consumer loans are expected to become more expensive following Bank Indonesia'€™s decision earlier this month to raise its key rate by 25 basis points to 6 percent after maintaining it for 16 consecutive months.

'€œWe don'€™t know yet whether or not the new key rate will lead to a surge in consumer credit rate because the latter is more important for us as an automotive [distributor] company,'€ Indomobil president director Jusak Kertowidjojo said after the company'€™s annual general shareholders'€™ meeting in Jakarta on Friday.

Indomobil will spend the next two to three weeks observing the changes in the global economy, the volatility in the stock market and the impact of the new fuel price, according to Jusak. '€œThe country'€™s automotive sales last year were relatively the same as the previous year. So we cannot really estimate the outcome in 2013 because the current situation is still fragile,'€ he said, declining to provide details on the company'€™s target.

Indomobil currently runs four business segments, including automotive, auto parts and financial services. In its automotive operations, it assembles and sells passenger cars, buses, trucks and heavy equipment for brands such as Nissan, Suzuki, Audi, Volvo and Hino.

Its latest financial report shows that the publicly listed company suffered from a 0.3 percent decline in revenues to Rp 4.9 trillion (US$493.5 million) in the first quarter of the year, from the same period in 2012.

Jusak said Jakarta'€™s January flooding and the downturn in the commodity sector contributed to the decline. '€œNissan'€™s business was affected by the floods because Jakarta is its biggest market. At the same time, our truck segment did not improve much,'€ he said.

Latest data from publicly listed diversified conglomerate PT Astra Internasional shows that 25,908 Nissan cars were sold in the first five months, more than an 8 percent decline from 28,403 Nissan units sold in the same period last year.

The company recorded a 39.8 percent drop in its net profits to Rp 142.46 billion in the first quarter from a year before, because of higher expenses resulting from higher direct labor and manufacturing costs.

It has allocated Rp 900 billion in capital expenditure this year to open between 30 and 40 new showrooms and for the provision of rental cars. It has more than 150 showrooms in several cities as of now.

It is also looking to begin producing truck bodies with Japanese truck manufacturer Kyokuto Kaihatsu Kogyo Co Ltd next month, after establishing two joint ventures with the Japanese last June through its subsidiary PT IMG Sejahtera Langgeng. It targets to produce 200 pieces per month during the initial stage.

The company'€™s shares ended at Rp 5,300 on Friday, up 0.9 percent from the previous day.