Motorcycle sales in July fell 28 percent from the same month a year ago as week-long holiday to commemorate Idul Fitri reduced sales day. ( JG Photo/Fajrin Raharjo)

Motorcycle Sales Drops 28% in July

BY :RAHAJENG KH

AUGUST 09, 2016

Jakarta. Motorcycle sales in July fell 28 percent from the same month a year ago as the week-long holiday to commemorate Idul Fitri reduced sales day.

Motorcycles producers shipped out 305,153 motorcycles last month, compared to 421,838 two-wheelers a year ago, data from Indonesia Motorcycle Association (AISI) showed. In the first seven months this year, manufacturers has sold 3.2 million motorcycles, down 11 percent from the same period last year.

"The drop in July was expected because of Idul Fitri holidays," Sigit Kumala, the deputy chairman for commercial affair at AISI said on Monday (08/08).

The government declared July 4 to 8 as the Idul Fitri holiday, a policy in line with Indonesian traditions of returning to hometowns to celebrate the holiday.

He expects sales to rebound to above 500,000 in August with office hours returning to normal.

The association, whose members include Japanese producers like Honda, Yamaha, Suzuki and Kawasaki, targets to sell 6.4 million motorcycles, slightly below  the 6.5 million motorcycles sold a year earlier.

Sigit noted that a drop in fuel prices and interest rates is yet to stoke demand. Gasoline prices have dropped by more than 7 percent this year on the back of weakening global oil prices. Meanwhile, Bank Indonesia, the country's central bank, cut interest rates by 1 percentage point so far this year to 6.5 percent.

"Prices of basic needs do not drop in line with fuel and interest rates. That's why people delay secondary purchases like motorcycles," Sigit said.

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