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Analysis: Auto sales in March ride high
Based on sales figures released by the association of Indonesian automotive manufacturers (Gaikindo) and the association of Indonesian motorcycle manufacturers (AISI), car sales in March reached 113,079 units, up 18 percent year-on-year (y-y) and 1 percent month-on-month (m-m), while the sales of motorcycles totaled 725,600 units, up 9 percent y-y and 7 percent m-m (chart 1 & 2)
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Based on sales figures released by the association of Indonesian automotive manufacturers (Gaikindo) and the association of Indonesian motorcycle manufacturers (AISI), car sales in March reached 113,079 units, up 18 percent year-on-year (y-y) and 1 percent month-on-month (m-m), while the sales of motorcycles totaled 725,600 units, up 9 percent y-y and 7 percent m-m (chart 1 & 2).
Astra International (ASII) booked March sales of 58,000 units, a 13-percent increase y-y, but a 4-percent decline m-m, reflecting lower market share of 51.3 percent (in March 2013 it held 53.5 percent). While the sales of its low cost green car (LCGC) models Agya and Ayla continued to book strong growth, sales of the Xenia and Avanza were limited by strong Honda Mobilio sales throughout the month.
At the same time, Nissan continued to book weak sales, with only 4,200 units, a 11 percent decline y-y and 1 percent drop m-m, resulting in the decline in its market share to 3.7 percent from 4.8 percent the previous year. It suffered from strong competition from Suzuki and Honda in the low multi-purpose vehicle (MPV) and LCGC segments.
In the motorcycle market, Honda's March sales reached 463,000 units, rising by 13 percent y-y and by 9 percent m-m. Honda has a market share of 63.8 percent, up 2 percent from the previous year. Yamaha also booked improved March sales of 227,000 units, up 4 percent y-y and 6 percent m-m.
Riding the strength of LCGC sales, we expect the domestic sales volume of four-wheeled vehicles to reach 1.35 million units in 2014, up 10 percent y-y, and 1.55 million units in 2015. With 2014 volume growth coming from LCGC models, we expect ASII's 2014 market share to remain well-supported at 53.9 percent with Nissan's 2014 share remaining at around 5 percent. However, aggressive marketing in the low MPV segment should mean margin contraction for both ASII and Indomobil Sukses Makmur (IMAS).
Although we expect the auto sector to experience solid volume growth, risks of intense competition and a possible fuel price hike have us maintaining our NEUTRAL sector rating. Hence, we believe the unexciting sector performance year-to-date will continue.
The author is an analyst at PT Bahana Securities
