Automotive Business: Performance Bolster
The improving performance of the financial segment and 2017’s hiking commodities prices empower ASII to post the positive performance amid the decline in 4W sales volume. The low growth of 0.4% y-y into IDR96.5 trillion in revenue posted by the automotive segment was offset by the hike of 42% into IDR64.6 trillion in revenue posted by the mining and heavy machinery segment.
Based on the bottom line outlook, the improvement in BNLI’s performance empowered the financial segment to post the surge of 376% y-y into IDR3.7 trillion in net profit. The fantastic surge offset the decline of 3% y-y into IDR8.8 trillion in net profit posted by the automotive segment.
Challenge of Automotive Competition
The 4W automotive segment contributing 30% to ASII’s overall revenue posted the decline of 1.7% into 579,114 units in sales volume amid the industrial increment of 1.7%. The launch of Mitsubishi Xpander and Wuling Confero as the new players in LMPV products heightening 4W competition is the potent driver for the decline in sales volume posted by the 4W automotive segment.
In 2018, the aggressive expansion of LMPV products launched by Mitsubishi dan Wuling will narrow the market shares for Avanza/Xenia. However, it is immature to conclude the success of Mitsubishi and Wulling as their LMPV products are still in the introduction stage. Besides, the launch of Rush and Terios with the revamp model is expected to offset the decline in sales of LMPV’s products whose selling price is nearly similar to the selling price of Mitsubishi Xpander.
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