Astra Stock Turbulence as Major BEV Producers Enter Indonesia

The stock price of Indonesia's automotive giant, Astra International Tbk (ASII), has faced pressure after nearly reaching the Rp 7,000 level mid-last year. It dropped to a low of Rp 4,930 on Jan. 29, the lowest in two and a half years or since August 2021. Although it rebounded to the 5,000s the next day, persistent negative sentiment has kept it hovering at that level. Year-to-date, Astra's stock has declined by about six percent, closing at Rp 5,350 per share on Monday, Mar. 25, with net foreign sales totaling Rp 2.4 trillion.

Despite Astra's profits increasing last year, there was a decline in car sales. Astra is involved in manufacturing, assembling, distributing, and operating dealer networks for Toyota, Daihatsu, Isuzu, Peugeot, UD Trucks, and Honda motorcycles. Additionally, Astra produces and retails BMW and Lexus cars. While the Astra Group sold 560,717 units of cars throughout last year, representing a 2.35 percent decrease from the previous year's sales of 574,198 units, this sales decline exceeded the national car sales decline of 1.5 percent.

Of note, Astra's sales decline nearly matched the number of battery electric vehicle (BEV) sales, totaling 17 thousand units last year. This suggests that BEVs are beginning to encroach on the market share of Internal Combustion Engine (ICE) cars, which Astra has traditionally dominated.