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Sept auto sales lower than expected
Based on sales figures released by the Association of Indonesian Automotive Manufacturers (Gaikindo) and the Indonesian Motorcycle Industry Association (AISI), sales of four-wheel (4W) vehicles fell to 103,000, down 11 percent year-on-year (y-o-y) but up 6 percent month-on-month (m-o-m), while sales of two-wheel (2W) vehicles reached 707,000, up 5 percent y-o-y and 6 percent m-o-m (tables 1 and 2)
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ased on sales figures released by the Association of Indonesian Automotive Manufacturers (Gaikindo) and the Indonesian Motorcycle Industry Association (AISI), sales of four-wheel (4W) vehicles fell to 103,000, down 11 percent year-on-year (y-o-y) but up 6 percent month-on-month (m-o-m), while sales of two-wheel (2W) vehicles reached 707,000, up 5 percent y-o-y and 6 percent m-o-m (tables 1 and 2).
Astra International (ASII) saw a lower September market share of 46 percent (August 2014: 49 percent; September 2013: 53 percent) due to flat m-o-m sales volumes of 47,600 units, down 22 percent y-o-y. Nissan also booked flat m-o-m sales at 2,500 units, down 61 percent y-o-y. Datsun sales remained unexciting at around 3,000 units, lower than management's initial target of 6,000. Honda continued to gain momentum, booking monthly sales of 16,000, up 10 percent m-o-m and 115 percent y-o-y, due to strong Mobilio sales.
On a more positive note, Honda's September two-wheel vehicle sales reached 459,000 units, up 10 percent y-o-y and 18 percent m-o-m, with an improved m-o-m market share of 65 percent (August 2014: 63.7 percent; September 2013: 61.8 percent). Yamaha booked September sales of 210,000 units, down 3 percent y-o-y but up 15 percent m-o-m.
With continued weakness in the monthly sales volumes, we expect 2014-2015 four-wheel vehicle sales to be flat y-o-y at 1.23 million units. For two-wheel vehicles, we expect sales in 2014 to reach 8 million, up 5 percent y-o-y, before reaching 8.3 million in 2015, up 4 percent y-o-y. We expect any impact of a fuel-price hike to be milder in the two-wheel segment than the four-wheel. Additionally, we also expect weak margins to persist on the back of intense competition and several policy headwinds.
On flattish volume growth due to policy headwinds plus lower average selling prices (ASPs) and margins on competition, we retain our sector underweight call on automotive, and expect continued market underperformance ahead (table 3). Hence, we advise investors to look elsewhere for better value.
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The writer is senior research manager at Bahana Securities.
