Indonesia produced 1.34 million vehicles in 2018, a 9.8% increase against 1.22 million vehicles made in 2017, data released late Wednesday by the Association of Indonesia Automotive Industries, or Gaikindo, showed.
Production for 2018 ended on a high note with December output at 98,461 vehicles, a 13.6% hike from 86,657 vehicles the year before.
Exports of completely built-up vehicles totaled 264,553 units in 2018 after tabulating the 24,951 units shipped out in December.
The annual result was 14.4% higher from 231,169 units recorded in 2017 while the December figure was a 54.1% surge versus 16,195 units the year before.
Looking at 2019, several market sources told S&P Global Platts that automobile industry growth may remain low to steady during January-March, on account of the upcoming general elections in April.
"This is a political year," a mill source based in Indonesia said. "Indonesia is a net importer of steel and we hope going forward, local mills can take up larger share of domestic consumption. Steel business profit margins have been low here."
A stockist based in Indonesia said revisions in steel import regulations could result in most downstream industry growth being supplied domestically, which is good news for local mills.
On January 10, Indonesia's ministry of trade said it revised steel import rules under trade regulation number 22/2018: "Provisions on the Import of Iron or Steel, Alloy Steel, and Derivative Products," resulting in regulation 110/2018.
The revised rules take effect January 20, under which, regulation of steel imports shall be carried out by customs officials at the border since steel imports spiked in 2018.
In 2018, about 55% of Indonesia's 14.2 million mt steel demand was met by imports, up from about 52% of 13.6 million mt in 2017, Enggartiasto Lukita, the trade minister said.
