Industry Profie: Motorcycle Industry in Indonesia

MOTORCYCLE INDUSTRY IN INDONESIA

January 2009

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Honda largest producer

Honda has continued to maintain lead in sales and production. In 2007, production of Honda motorcycles reached 2.14 million units or 45.42% of the country's total production.

The production of Honda rose 32.6% to 2.83 million units in 2008 when sales grew 33%. Despite the strong growth, the production ratio dropped slightly to 45.19%.

Yamaha the second market leader had a production of 1.67 million units in 2007 to 35.6% of the country's total production. In 2008, the production shot up 50.54% to 2.52 million units or 40.18% of the country's total production.

Yamaha has succeeded in the past few years in closing in on Honda in production and sales. Thanks to success in sales of new models and capacity expansion. It has even led in monthly sales several times in 2007.

In 2009, production is expected to slow down or decline on market slump both on the domestic and international markets. A Yamaha factory in Karawang is designed to produce motorcycles for exports.

Indonesia is the largest producers of Yamaha motorcycles in the world contributing around 40% to total Yamaha production in the world every year.

The production of Suzuki motorcycles has also increased but its market share declined as Honda and Yamaha grabbed the largest share of the market.

Sales in 2008 exceed 6 million units

Sales of motorcycles in the country has surged after declining in 2006 rising 5.44% to 4.47 million units in 2007 and up again 33.24% to 6.28 million units motorcycles in 2008. The increase thanks to improved economic condition.

Honda maintains lead

Honda has maintained lead in sales although there were months in 2008 when its sales fell back behind Yamaha. In annual sales, it has continued to keep fairly strong lead. In December, 2008 sales of Yamaha totaled 194,423 units as against Honda's 173,849 units.

In 2007, sales of Honda motorcycles totaled 2.14 million units or a market share of 45.45% as against Yamaha's sales of 1.85 million units or 39.32% of the total sales.

In 2008, both Honda and Yamaha recorded an increase in sales with Honda ending that year with sales of 2.88 million units or a market share of 45.81% and Yamaha recording sales at 2.52 million or a market share of 40.17%.

In January 2009, Honda regained the monthly lead with sales at 179,685 units as against Yamaha's 162,656 units.

Market share of automatic scooters up

Automatic scooters recorded an increase in market share in 2007 and 2008 in the country. Sport type motorcycles also recorded an increase in market share.

In 2007, sales of automatic scooters reached 872,066 units or 18.5% of the total sales of motorcycles in the country.

In 2008, sales of motorcycles of this type rose further to 1,613,661 units or 25.7% of the total sales. The largest contributor to the sales of automatic scooters was Yamaha, followed by Honda, Suzuki, and Kymco.

Automatic scooters are growing in demand in the country. The market share of automatic scooters rose sharply in the wake of the oil fuel price hikes in December, 2005.

In 2007, sales of sport motorcycles totaled 377,107 units or 8% of the total sales. The market share rose to i 8.5% in 2008 when sales totaled 533,868 units.

Meanwhile, the type of under bone motorcycles have continued to dominate the market although declining in market share. In 2007, sales of under bone motorcycles totaled 3,464,705 units or 73.5% of the market volume. In 2008, the sales rose to 4,132,756 units, but the market share fell to 65.8%.

The decline in the market share of under bone type came with the rise in demand for automatic scooters and sport motorcycles. Under bone motorcycles were originally designed for female users but now most consumers including males chose that type.

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