Automotive - Gaikindo explains the reasons for declining car wholesale sales

Automotive - Gaikindo explains the reasons for declining car wholesale sales Entering the beginning of 2024, the Indonesian automotive market actually looks sluggish. This is shown by national car sales shrinking in January. According to data from the Association of Indonesian Automotive Industries (Gaikindo), wholesale sales (factory to dealer) were recorded at 69,619 units in January 2024, or down 26.1% yoy compared to actual sales in January 2023, namely 94,270 units. At the same time, national car retail (dealer-to-consumer) sales also decreased 13.9% yoy to 78,214 units in January 2024 from the previous 90,892 units. According to Gaikindo, the decline in car sales in Indonesia last month was caused by the effects of national economic growth, which was also experiencing a slowdown. (Source : Kontan) Comment : Despite historical data indicating that January period sales always recorded slower growth, Jan24 declining sales are recorded as the slowest in the past decade. The key to declining sales is the wait-and-see stance, in our view. With the upcoming better confidence in the domestic economic political situation and IIMS 24 sales, as well as our expectation of normalized February 24 car sales, 1Q24 sales are likely to arrive within market expectations. Our conservative ‘24F 4W sales were 1.05 mn units vs. Gaikindo, which expects car sales to reach 1.1 mn units. The ‘24F growth, which looks flat, is mainly a result of the higher-based effect of FY23 sales.