Indonesia is next growth market for automotive industry

Analysts at IHS Automotive and JPMorgan Chase say that after China, Indonesia may be the next growth market for the automotive industry. Indonesia now has the largest economy in Southeast Asia, but its ratio of car ownership continues to be among the lowest in the region. Experts say the automotive industry is ready to expand because of rising income, urbanization and government’s efforts to push demand for low-emission vehicles. “Indonesia’s auto market is on the verge of a boom,” Jessada Thongpak, a senior analyst for Southeast Asia at IHS Automotive said. “The reason why automakers are looking at Indonesia is because the potential for growth is high and inflation and interest rates are stable,” she added. U.S. automakers are gearing up for a slice of the market, and Japanese carmakers and India’s Tata Motors are also up for the challenge. IHS Automotive predicts that Indonesia will see a jump in automobile sales to 1.2 million units by 2016. (January 19, 2012)