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Jakarta Post

New Honda City hits the road amid drop in sedan market

Shiny and new: Models pose beside the all-new Honda City during its launch in Jakarta on Thursday

The Jakarta Post
Jakarta
Fri, April 25, 2014

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New Honda City hits the road amid drop in sedan market Shiny and new: Models pose beside the all-new Honda City during its launch in Jakarta on Thursday. The new version of the Honda City has been launched amid reports of declining sedan sales in the country. (JP/Nurhayati) (JP/Nurhayati)

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span class="inline inline-none">Shiny and new: Models pose beside the all-new Honda City during its launch in Jakarta on Thursday. The new version of the Honda City has been launched amid reports of declining sedan sales in the country. (JP/Nurhayati)

PT Honda Prospect Motor (HPM) launched on Thursday the all-new Honda City amid a decline in sedan sales in the country'€™s automotive market.

Marketing and after-sales service director Jonfis Fandy said that with the new model, sales of Honda City sedans were expected to reach about 1,950 units this year, below the 2,974 recorded last year.

He said that the company had set a lower sales target for the Honda City this year due to the projected decline in overall sedan sales in the country this year.

'€œSince the beginning of this year, we have been predicting that sedan sales growth will be slower than last year. That'€™s why we haven'€™t raised our sales target for the Honda City,'€ Jonfis told reporters during a press conference.

Since it entered the Indonesian automotive market in 1996, Honda has sold 64,034 units of the model, making it the highest-selling mini-sedan in the country, said Jonfis. The sedans are imported from Thailand.

The all-new Honda City'€™s 1.5 L cc i-VTEC engine is equipped with a paddle-shift feature, which is used in Formula One race cars. It also introduces fuel-efficient technology that meets Euro-4 standards and a one-push ignition system.

The rupiah'€™s fall against the US dollar had partly contributed to declining sales in the sedan market, he said, adding that the weak rupiah had caused sedan prices to soar.

'€œSedan prices are high because of the weak rupiah and high luxury sales tax. So we forecast that the sale of sedans, including the Honda City, will decrease this year,'€ Jonfis explained. In the country'€™s automotive market, the market share of sedans, which was 2.8 percent last year, was expected to drop to 2 percent this year, Jonfis predicted.

Jonfis said that Honda'€™s total sedan sales in the Indonesian market was projected to reach 12,000 units this year, a 72 percent increase from last year'€™s figure. HPM sold 6,957 sedans or 7.6 percent of its total sales of 91,493 units last year. In 2012, the company sold only 4,834 sedans or 6.9 percent of its total sales of 69,320 units.

HPM last year secured a 45 percent share in the sedan market and was expected to maintain the level despite the shrinking sedan market, he said. '€œWe are confident that we can maintain our sedan market share this year because we keep upgrading technology, including in the Honda City,'€ said Jonfis.

Honda'€™s total car sales rose 32 percent to 91,493 units last year from 69,320 units last year. Main contributors were the Honda Jazz and Honda CR-V, which respectively recorded total sales of 27,803 units, a 31 percent increase from the previous year, and 20,385 units, a 38 percent increase year-on-year.

The Indonesian Automotive Industry Association (Gaikindo) estimates that this year'€™s total sedan cars will fall to 34,000 units due to the luxury sales tax increase imposed on sedan sales. Last year, sedan sales dropped from 34,221 units in 2012 to 34,199 units in 2013, which accounted for 2.8 percent of total car sales during the year. (alz)

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