"Car sales fell by 1.1 percent to 80,400 units in January, 2020 and went down further by 3.1 percent to 79,500 units in February compared to the previous period," said Industry Minister Agus Gumiwang Kartasasmita in a written statement released on Wednesday.
The drop in car sales has prompted the Indonesian Association of Motor Vehicle Manufacturers (Gaikindo) to halve the sales target for 2020 .
The other problem facing the national automotive industry is the disruption in the supply of raw materials and components from countries implementing a lockdown to slow the spread of the coronavirus disease, the minister said.
The lockdowns have prompted domestic car manufacturers to find alternative sources of raw materials and components to maintain production, he added.
"The disrupted automotive industry has had an adverse impact on the national economy because it contributes significantly to the GDP (the gross domestic product), particularly the GDP in the non-oil/non-gas sector, at 3.98 percent in 2019," said Director of Maritime, Transportation Means and Defense Industries of the Industry Ministry Putu Juli Andika.
Commenting on the decision by several sole agents to temporarily halt production, he said they took the step to protect employees in wake of the coronavirus outbreak.
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