Car Production Reached Target, How Is The Market Absorption At The Edge Of PPnBM Discounts?

JAKARTA - The Ministry of Industry has confirmed that the production of four or more wheeled motorized vehicles for the 2021 period of 850,000 has been exceeded.

Minister of Industry (Menperin) Agus Gumiwang Kartasasmita said that until October 2021, production had reached 890,000 units or grew 62.4 percent from the same period in the previous year.

"I am optimistic that sales will also increase along with various events and promos held by APM towards the end of the year to stimulate people's enthusiasm to buy motorized vehicle products," he said in a press statement quoted on Friday, December 10.

According to the Minister of Industry, the implementation of the Sales Tax on Luxury Goods Borne by the Government (PPnBM DTP) for the motor vehicle sector has proven to be able to have a significant impact on the recovery of the automotive industry sector and increase the confidence of industry players.

"I give my appreciation to automotive manufacturers and dealers who have helped, encouraged, facilitated buyers to get and take advantage of this stimulus with additional promotions and other price discounts," he said.

According to the Minister of Industry's notes, this incentive boosted car sales up to 487,000 units or up 71.02 percent (year-on-year/yoy) for the March-November 2021 period.

The Minister of Industry added that the PPnBM discount program ending December 31, 2021 has empowered as many as 319 tier 1 component industry companies.

All of this is part of fulfilling the requirements for the use of local components or local purchases in the production process with a minimum value of 60 percent. This certainly has a positive impact on the recovery of the automotive industry sector, which has a wide multiplier effect for other industrial sectors, so that in the end it will be able to jumpstart the national economy," he explained.

For information, the automotive industry is one of the most important sectors and a major contributor to GDP. Currently, there are 21 industrial companies of four-wheeled or more vehicles with a production capacity of 2.35 million units per year, by absorbing 38,000 direct workers.

Meanwhile, the total investment that has been invested has reached IDR 140 trillion, and is believed to provide a livelihood for the 1.5 million people who work along the industrial value chain.

"I am very proud that currently our automotive products have been successfully exported to more than 80 countries. During January-October 2021, there were 235,000 units of CBU vehicles with a value of Rp. 43 trillion, 79,000 sets of CKD with a value of Rp. 1 trillion, and 72 million units of components with a value of Rp. 24 trillion.