New Car Sales Remain Sluggish, Industry Minister Hopes for Swift Recovery

KatadataOTO – New car sales in Indonesia have not yet shown positive results at the beginning of 2025. The government has spoken out about this condition.

According to the Minister of Industry (Menperin), there are a number of causes that made the automotive industry quite sluggish last January.

“From many factors, we see it is related to the decline in people's purchasing power,” said Agus Gumiwang Kartasasmita, the Minister of Industry, during the inauguration of the Daihatsu factory in Karawang, West Java some time ago.

Then Agus assessed that global economic challenges also contributed to new car sales not being able to recover in January 2025.

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Therefore, he hopes that manufacturers can innovate. Especially in developing new products that are consumer and environmentally oriented.

Agus stated that this must also be accompanied by sustainable government support.

“We want attention to be paid to the development of environmentally friendly green innovations. It is hoped that the Indonesian market can recover in the shortest possible time,” Agus continued.

He also said that President Prabowo Subianto and the ministers have provided a stimulus package for the purchase of new four-wheeled vehicles.

The policy above allows people who buy electric and hybrid cars to get a tax cut this year.

Beyond that, Agus also gave some suggestions that manufacturers could implement. Such as adjusting the price tag.

“We hope there will be new policies (from the factories). For example, this is not a directive, sacrifice the margin or lower the selling price of (new) cars,” Agus emphasized.

The Minister of Industry also believes that a combination of government incentives and price reductions can make people willing to spend their money.

For your information, based on data from Gaikindo (Association of Indonesian Automotive Industries), in January 2025, shipments from factories to dealers (Wholesales) were only 61,843 units.

The figure above is a correction of 11.3 percent compared to the same period last year. According to records, in January 2024 there were 69,758 units.

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Meanwhile, retail sales suffered a similar fate. Dropping 18.6 percent from 78,437 units to 63,858 units.

Meanwhile, wholesales throughout 2024 also plummeted 13.9 percent YoY (Year on Year) compared to the 2023 period, from 1,005,802 units to 865,723 units.

Finally, retail sales from January to December 2024 were only 889,680 units. Down 10.9 percent from the previous year, which was 998,059 units.