The Indonesian automotive industry is not anticipating a heavy blow from the novel coronavirus outbreak, although the February sales figure dropped to the lowest level in eight months and the industry’s top event, the Indonesia International Motor Show (IIMS) 2020, had been “postponed indefinitely”.
Car sales continued to decline with 79,573 units sold in February, a 2.73 percent decrease from 81,809 units in February last year and the lowest level since June 2019, according to data provided by the Association of Indonesian Automotive Manufacturers (Gaikindo).
However, the association downplayed the foreseeable impacts from COVID-19, which the World Health Organization (WHO) declared a “pandemic” on March 11 in Geneva.
“We do not expect COVID-19 to greatly impact the market. Car sales in February were impacted by the virus [outbreak], as the hard-hit tourist industry was forced to postpone purchases of tour buses and other vehicles,” Gaikindo chairman Yohannes Nangoi told The Jakarta Post on Tuesday.
Sales had also declined in January as a result of widespread severe flooding in several regions, including the capital city, and growing negative sentiment and public fears of the COVID-19 epidemic that emerged on Dec. 31, 2019 in Wuhan, China.
Domestic car sales were also expected to follow a downward trend in March and April as the COVID-19 continued to disrupt the economy and the daily lives of Indonesians.
“I think there will be a further fall in March as the virus closes schools, offices and dissuade people from visiting retail shops, including car showrooms,” Yohannes said.
The industry association is, however, maintaining its 2020 sales target of 1.05 million cars.
In contrast, the decision to postpone the IIMS, one of the biggest industry expos in Indonesia, is likely to spell trouble for the automotive industry.