Indonesia is the second largest car manufacturing nation in Southeast Asia and the ASEAN (Association of Southeast Asian Nations) region, trailing behind Thailand, which controls about half of total car production. 

Well-known auto producers have opened or reopened manufacturing plants or increased production in Indonesia. 

In 2017 SAIC-GM-Wuling — a joint venture between General Motors, SAIC, and Guangxi Automobile Group — invested $700 million into a manufacturing facility in Indonesia. 

The facility would cover roughly 148 acres and have an annual capacity of 120,000 vehicles. 

The first product of this facility was the Wuling Confero S MPV (multi-purpose vehicle). 

Secondly, thanks to a rising GDP, car production in the country has transitioned from being mostly export focused to now also include production to meet rising domestic sales.

Automotive Production

Car production in Indonesia saw a peak in 2014 at 1,298,523 vehicles produced for the year. Sales dropped to 1,098,780 in 2015, but since have climbed back to 1,216,615 as of 2017. 

This is significantly fewer than the 1,988,823 Thailand produced that same year, but is far and above the third-largest producer in the ASEAN region Malaysia, at 499,639 vehicles. 

Currently, Japan leads the pack as the major investor in Indonesian car manufacturing facilities. The top five brands by production volume include Toyota in the top spot, followed by Honda, Daihatsu, Suzuki and Mitsubishi. 

Auto Sales

Although Thailand leads the way in production, Indonesia has secured the top position in vehicle sales, with 1,079,534 in 2017 compared to Thailand’s 871,650. That’s because Indonesia is the largest car market in Southeast Asia and ASEAN, accounting for about one-third of annual car sales in ASEAN.

Gaikindo, the Indonesian automobile manufacturers association, reports year-over-year car sales stood at 3.2% higher year-over-year as of January 2019. 

However, previous months reported stronger YOY sales stats at 4.2% in December 2018, 6.2% in October and a whopping 12.3% in November. In all, full-year 2018 car sales were up 6.9% to 1,151,291 units. 

Gaikindo projects car sales in Indonesia will remain at 1.1 million units in 2019.

Currently, Indonesia averages 68 cars per 1,000 inhabitants. With a large population of 258 million inhabitants, and a rapidly growing middle class, that number, along with domestic sales, could trend upward. 

Vehicle Preferences

For fleets, the top brands are Toyota, Honda and Kia/Hyundai, with these models emerging as the most popular choices:

• Toyota Avanza

• Toyota Innova

• Honda CRV

A strong dealer network exists in major cities including Jakarta (the capital), Surabaya, Medan, Bandung, Palembang, and Makasar.

Major Industries in Indonesia

Major industries in Indonesia include petroleum and natural gas, textiles, apparel, footwear, mining, cement, chemical fertilizers, plywood, rubber, food, and tourism. 

GDP by sector is:

• Industry — 46.4%

• Services — 37.1%

• Agriculture — 16.5% 

Among these, the agriculture, chemical, and pharmaceutical industries provide the most fleet cars. Examples of how businesses allocate fleet vehicles include:

• Junior professionals: Toyota Rush, Honda City

• Sales professionals: Toyota Innova, Toyota Avanza

• Managers: Toyota Altis, Toyota Fortuner, Honda Civic, Honda CR-V

• Executive: Toyota Alphard, Toyota Camry 

The ratio of company-owned to leased vehicles is about 30% and 70%.