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Jakarta Post

Luxury car sales predicted flat this year

  • Anton Hermansyah
    Anton Hermansyah

    The Jakarta Post

Jakarta   /   Thu, September 22, 2016   /  06:18 am
Luxury car sales predicted flat this year A model poses beside the Ferrari 488 Spider at Plaza Indonesia, Jakarta, on Sept. 21. (JP/wienda parwitasari)

A weakening economy has led many high-end customers to hold off purchases of luxury cars, thus this year's sales are expected to be flat, similar to last year.

According to Ferrari Jakarta CEO Arie Christopher, since the end of 2013, the luxury automotive market got hit hard, as the commodity boom ended and the rupiah depreciated.

"Moreover in April 2014 the government increased automotive taxes [affecting] luxury vehicles. Until now, sales have never been as high as before," Arie told The Jakarta Post without disclosing any numbers at the launch of Ferrari’s 488 Spider in Jakarta on Wednesday.

Despite being a niche car Ferrari sales have been affected as well. Moreover, the manufacturer does not want to reduce the engine capacity of its cars further. Meanwhile competitors such as Porsche already reduced their engines to 3.0 and 2.5 liters respectively but with turbo, to adapt to the new taxation scheme despite having the same power output.

"The engine capacity has been actually pared down from a 4.5 liter to a 3.9-liter turbo, further reductions and configuration changes other than the V8 [engine] will erode the driving characteristics of a Ferrari," Arie added.

In the vehicle taxation scheme, cars with engine bigger than 3.0 liters will get a 125 percent value-added tax (VAT). Before April 2014 the VAT was just 75 percent. (evi)

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