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New cars are transported by a truck for delivery to dealers in Jakarta.   © Reuters

Indonesian car demand set to weaken to near 2014 levels

Sluggish economic growth puts brake on consumer spending

| Indonesia
  • Passenger car demand in Indonesia is set to weaken in the first half as consumers grow cautious on spending.
  • Competition will intensify as manufacturers turn more aggressive in launching new products, with Honda, Mitsubishi and Suzuki taking the lead.

The latest survey from FTCR suggests that consumer demand for passenger cars in Indonesia will weaken in the next two quarters, close to levels seen in 2014 when the country was still reeling from the impact of the previous year's so-called taper tantrum on its currency.

While currency weakness is still being felt by Indonesians, FTCR views today's anaemic demand as a result of a prolonged slowdown in economic growth, leaving consumers more cautious on making big-ticket purchases.

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