Indonesia's largest automobile manufacturer, PT Toyota Astra Motor, the local unit of Japan's Toyota Motor Corp, has lowered its new car sales target for this year amid slow demand during the first semester.

The company put the sales target at between 120,000 and 130,000 units, or between 28 and 34 percent less than last year's sales, The Jakarta Post daily reported Wednesday.

The company sold a total of 182,724 cars last year.

Toyota Astra president Johnny Darmawan predicted that 2006's national car sales would fall by 34 percent from 533,910 units last year.

"This year's domestic sales are likely to range between 350,000 to 400,000 units," he was quoted as saying.

He based his forecast on this year's first quarter car sales, which dropped 44.8 percent to only 79,414 units from 143,963 units in the same period last year.

In line with the national trend, Toyota Astra Motor's car sales up to March of this year declined by 22.3 percent to only 34,478 from 44,348 units in the first quarter last year.

Johnny said that the sluggish performance of the automotive industry was due to a drop in consumer purchasing power resulting from high interest rates and last October's fuel price increases.

The central bank raised its key interest rate to 12.75 percent in December from 8.5 percent in July to curb inflation and the decline in the rupiah. The rate remains at 12.75 percent until now, but Bank Indonesia indicated Tuesday that it might soon lower the rate amid signs of easing inflation.

Despite the drop in sales, Toyota Astra Motor remains the market leader, with a 43.4 percent market share in the first quarter.

Source: Xinhua