Automotive Shares Tumble on News of Motorcycle Sales Dip
Jakarta Globe & Antara | July 10, 2012
Shares of Astra International, the country?s biggest automotive distributor, and its rivals fell on Monday after media reports that motorcycle prices slid in June from the previous month and that car sales were expected to slow in the second half of the year.
Motorcycle sales fell by almost 3 percent to 550,468 units in June from 619,540 units in May, Antara news agency reported, citing Gunadi Sindhuwinata, chairman of the Indonesian Motorcycle Industry Association (AISI), in Jakarta on Monday.
Car sales are expected to reach 375,000 vehicles in the second half of the year, way below the 534,876 units sold in the first half of the year, according to a forecast by the Association of Indonesian Automotive Industries (Gaikindo) last week.
Low motorcycle sales, used as a gauge of economic activity, paint a bleak picture for car and motorcycle makers, analysts said. Shares of Astra International fell 2.9 percent to Rp 6,750 on Monday. Indomobil Sukses Internasional shed 4.5 percent to Rp 7,450.
Astra International is the biggest company by market capitalization on the stock market, accounting for Rp 273.3 trillion ($29 billion), or 7.3 percent of the value of all 447 companies listed on the Indonesia Stock Exchange.
?The increase in the down payment requirements hurt motorcycle sales,? AISI?s Gunadi said.
In a move to improve prudent banking practices and prevent excessive lending, the government tightened the rules for purchasing motorcycles. Since the middle of June, potential buyers have been required to make down payments of at least 25 percent of the total value of the bike.
Before the new rules, many buyers drove new motorcycles home with little or no money down.
Honda Motor, a unit of Astra International, sold 332,272 motorbikes in June, down from 362,127 in May but still good enough to be the sales leader for the month, according to AISI. Yamaha Motor Kencana Indonesia, the sole distributor of Yamahas in Indonesia, sold 167,661 motorcycles in June compared with more than 200,000 units per month in previous months.
Motorcycle sales at Suzuki Motor Indonesia fell to 36,532 units in June from 40,859 in May, according to AISI.
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