Indonesia has hit the fast lane in terms of auto sales and has overtaken Southeast Asian pace-setter Thailand for the first time, according to a Nikkei survey from the first six months of the year.
Officials and auto executives attending the 18th Indonesia International Motor Show in Jakarta told AFP the outlook for sales in the archipelago of 240 million people had never been brighter.
"Since late 2009 and early 2010, all auto brands and producers have been trying to increase production capacity in Indonesia" to meet demand, industry ministry official Budi Darmadi said.
"Compared to other countries in the region, we have the fastest growth of car sales."
Sales peaked in Indonesia at 600,000 units in 2008 but slumped 20 per cent last year due to the global financial turmoil. This year's figures are expected to top 700,000 for the first time, ahead of Thailand.
The Indonesian Automotive Industry Association (Gaikindo) said auto sales in Indonesia jumped 76 per cent to 370,206 vehicles in the first half of 2010, driven by strong demand for minivans with engine outputs of 1.5 liters.
Sales in Thailand rose 54 per cent to 356,692 units during the same period, according to the Nikkei survey released Wednesday.
Some 1.18 million new vehicles were sold in Indonesia, Thailand, Malaysia, the Philippines, Vietnam and Singapore during the period, it said.
This was an increase of 41 per cent and put the industry on track to surpass the 2008 sales record of 2.09 million units for the six key Southeast Asian markets.
The news will be music to the ears of Toyota executives -- Japanese cars account for about 80 per cent of sales in these countries.
Multipurpose models like Toyota's Avanza -- a four-door family hatchback -- make up 30 per cent of total sales in Indonesia, Nikkei said.
"Indonesia may hit its first million annual car sales in the next two years," industry analyst Suhari Sargo said.
Sargo said more and more Indonesians would trade in their motorcycles for cars as wealth was more evenly distributed outside the economic centre of Java island.
"But before it can achieve more well-balanced wealth distribution, the government must improve infrastructure such as roads," he said.