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otorcycle maker PT Yamaha Indonesia Motor Manufacturing has lowered its two-wheeler sales target this year on the back of a steep trade decline last year, an executive has said.

Yamaha marketing general manager Mohammad Masykur said that the company aimed to sell 2 million motorbikes this year, 21 percent lower than the 2.55 million targeted in 2015.

'€œLast year, we only sold about 1.8 million motorbikes, a far cry from the target. Other manufacturers experienced similar situations,'€ Masykur said Sunday.

He said that his company sold more than 2 million motorbikes in 2014.

The Indonesia Motorcycle Industry Association (AISI) recently announced that 2015'€™s total distribution of motorcycles from factories to dealers '€” which provides a big picture of sales conditions '€” decreased 18 percent to 6.4 million from 7.8 million in 2014.

Masykur said that Yamaha, the second-biggest motorcycle manufacturer in the country after Honda, saw a 20 to 25 percent drop in sales last year as low-income people who account for 60 percent of Yamaha motorcycle buyers had their purchasing power severely affected by ballooning food prices.

'€œAt the end of 2014, the fuel prices rose, followed by the increase of other basic commodity prices. In addition, commodity prices, such as rubber, coffee beans, palm oil and coal, are decreasing, putting further pressure on the low-income community, which includes farmers and small-time miners,'€ he explained.

To achieve the new target, Masykur said his company would adopt a new marketing strategy, which would include providing a bigger credit scheme to various provinces.

'€œ[In the past] farmers in Kalimantan and Sumatra, for example, used to pay in cash. That will no longer be the case. We might need to offer more credit schemes,'€ he said.

Similar to Yamaha'€™s lower target, AISI has also scaled down its aim to distribute 6.5 million motorbikes from its five active members '€” Honda, Yamaha, Suzuki, Kawasaki and TVS '€” amid a prediction of slow economic recovery.

'€œWe have yet to see signs that there will be significant improvement. Lingering pressure from the global economy will continue to impact on the country'€™s economy,'€ AISI trade head Sigit Kumala said.

Sigit suggested that the government help lower basic commodity prices in line with the recent move to lower gasoline and subsidized diesel fuel prices following the drop in the benchmark prices of crude oil.

'€œOnly when people have sufficient income and can fulfill their primary needs will they think of buying secondary and tertiary needs, including motorbikes,'€ he said.

Motorcycle distribution dropped 18 percent to around 6.4 million in December 2015 from 7.8 million in the same month in 2014, according to AISI data.

Meanwhile, November data said that major producer Honda saw the smallest decline at 12 percent, followed by Yamaha and Kawasaki, each with a 26 percent drop, and Suzuki and TVS with a 60 percent and 69 percent decline, respectively. (rbk)