Mabua Harley-Davidson has announced it will sell its remaining stock of around 100 motorbikes and merchandise at discounts of between 30 and 70 percent, having previously announced it would not extend its franchise license because of skyrocketing tax in Indonesia.

Based on the distribution agreement, the license expiration will revoke Mabua'€™s right to sell any more motorbikes, though it will still be allowed to sell spare parts and merchandise.

"We will sell off our inventory such as merchandise and spare parts and around 100 remaining motorbikes. We will offer 30 to 70 percent discounts," PT Mabua Harley-Davidson sales and marketing director Irvino Edwardly said in Jakarta on Wednesday.

According to the press statement, the US motorcycle manufacturer is looking for a new dealer in Indonesia, while PT Mabua Harley-Davidson will provide maintenance and reparation services until June.

Any new purchases will be made through Harley-Davidson Asia Pacific headquarters in Singapore.

"The dealer is a facilitator for HOG [the Harley Owners Group] to buy merchandise and spare parts and organize gatherings. After Mabua ends its partnership with Harley, the Asia-Pacific Harley-Davidson in Singapore will be HOG'€™s caretaker," HOG Jakarta chair Ignatius Sahat Manalu told thejakartapost.com.

After enjoying excellent sales from 2002 to 2013, Mabua decided not to renew its agency license after the government introduced a 300 percent tax on large motorcycles in 2014. Things got worse in 2015, as the rupiah weakened by 40 percent, causing prices of the vehicles to soar.

"The period from 2002 to 2013 was our golden period, with increasing sales that reached a peak in 2013. Then the storms came," Irvino said.

In 2011, he continued, Mabua sold 500 motorbikes, with 660 sold a year later. In 2013, sales reached a record 991. "The new taxation rules doubled the price of all models. In 2014, our sales dropped almost 50 percent to 471 units," he said.

Mabua'€™s margins were slashed significantly from 35 percent to between 5 and 7 percent, Mabua CEO Djonnie Rahmat said. (ags)

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