Throughout April and May of 2020, Indonesia imposed its own version of quarantine lockdown called the Large Scale Social Restriction (PSBB) as a core response to the COVID-19 pandemic. This involved regional governments having the authority to stipulate the timeline for exiting from quarantine measures as deemed necessary for the needs of their specific regions.
The large-scale social restrictions (PSBB) that underpinned the quarantine lockdown implemented in Indonesia at the peak of the COVID-19 pandemic forced the closure of all car showrooms and this pushed many car dealers to shift to online channels to retain sales, with premium and luxury car brands no exception. BMW Group for instance closed all of its showrooms and shifted to the online channel, appointing Tokopedia as its official online dealer.
According to Indonesia’s Association of Motor Vehicle Dealers (Gaikindo), volume sales of BMW Group, the company behind the BMW and Mini marques in the country, dropped by around one-fifth over the first half of 2020, compared with the same period of 2019. Daimler AG meanwhile experienced a drop of almost on-half over the first half of 2020, in comparison with same period of 2019.
Despite the pressure that came on demand for new cars in Indonesia during 2020 as a result of the COVID-19 pandemic, the Ministry of Industry is still optimistic that the overall automotive industry still has a positive outlook for the forecast period. These positive productions are based on continuous infrastructure development and rising production capacity.
Innovation is expected be a major factor spurring growth in sales premium and luxury cars during the forecast period. In particular, innovation in the category is expected to centre on electric/hybrid vehicles.
The major cities on the island of Java, especially Jakarta and Surabaya, have long been the centre of economic activity in Indonesia. Indeed, Java alone accounted for around 59% of Indonesia’s national GDP in 2019.
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Understand the latest market trends and future growth opportunities for the Luxury Cars industry in Indonesia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
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This report originates from Passport, our Luxury Cars research and analysis database.
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