Toyota raises prices in Indonesia to avert losses

The Jakarta Post, Jakarta | Fri, 01/02/2009 10:29 AM  

Toyota, the nation's market leader for cars, has raised its prices by between 5 percent and 13 percent, effective Jan. 1, despite an expected fall in sales due to the global economic slowdown. 

"For the domestically assembled complete knock down (CKD) vehicles such as Innova, the price increase will be around 5 percent to 8 percent, while for imported complete built up (CBU) vehicles, the price rise will be about 10 percent to 13 percent," Toyota Astra Motor marketing director Joko Trisanyoto said Tuesday, as quoted by Antara. 

The price of an Avanza will increase by about Rp 6 million (US$530) from the current lowest price of Rp 116 million, while prices of high-end CBUs, such as Camry and Crown, will increase by between 10 percent and 13 percent, he said. 

A Camry sedan currently sells for between Rp 380 million and Rp 550 million. 

Joko said the price increase was inevitable, due in part to the weakening of the rupiah against the U.S. dollar. 

The rupiah has been hovering above Rp 11,000 per dollar for the past two months, while Toyota has been setting prices based on an assumption of Rp 9,200 to the dollar, he said. 

"The dollar has strengthened against the rupiah by around 20 percent. Thus, the price increase for imported CBU cars may actually reach 20 percent," he said. 

He added that some spare parts were imported from countries such as Japan whose currency was also strengthening. 

Although prices have fallen for several major materials such as steel, Toyota would increase prices to account for last year's steel price increase, he said. 

"With this price increase, we can at least get marginal profits after covering our production costs," he said. 

Joko added there was the possibility of a series of price increases during the year because prices of Toyota cars remained on average below competitors' prices. 

"We are still targeting a market share of around 34 percent this year, amid forecasts that national car sales will plummet by around 30 percent," he said. 

In the January to November period last year, domestic car sales reached 568,150 units, with Toyota accounting for 194,000 units. 

Car sales for all of 2008 are estimated to be at around 600,000 units, with Toyota expected to account for around 208,000 of those. 

Around 80 percent of cars sold in Indonesia are made by Japanese producers including Honda, Suzuki, Daihatsu and Mitsubishi. (dis)