Local and Indonesian online sources have reported that the Indonesia’s authorised Harley-Davidson distributor PT Mabua Indonesia will cease its operations later this year.
Despite being in one of the largest motorcycling markets in South East Asia, the famed bar-and-shield brand has been struggling to perform over the last few years. Malaysian business sources report that PT Mabua Motor Indonesia will wind down the business in stages. It also stated that the Indonesian firm had already halted importing new Harley-Davidson bikes into the country as of 31 December 2015.
Soetikno Soedirjo, the CEO of the Mugi Reksa Abadi (MRA), which is PT Mabua’s biggest shareholder, was quoted by local Indonesian media as stating that the move was the result of several factors that affected PT Mabua’s sales of Harley-Davidson motorcycles in the Indonesia market.
Soetikno Soedirjo further added, “We recorded peak sales in 2013 with 991 motorcycles sold, but sales gradually fell to 471 in 2014 and 483 in 2015.”
PT Mabua president Djonnie Rahmat was also quoted by local media when he highlighted the closure was due to the unsupportive tax regulations imposed by the Indonesian government over the last three years. He further added that the weakening value of the Indonesian Rupiah currency also made things difficult for PT Mabua to import Harley-Davidson’s range of high-capacity bikes.
Presently, PT Mabua’s network in Indonesia is comprised of nine dealerships located across five cities, and all of which will be closed in stages. Reports online also indicated that PT Mabua will continue providing after-sales services and spare parts sales for its customers until the end of June this year.
Other sources are also reporting that up to 500 members of PT Mabua’s workforce will be laid-off whilst several permanent staff members will be reassigned in its after-sales service operations at authorised workshops.
Harley-Davidson Asia Pacific have reportedly begun searching for a new Indonesian distributor. Indonesian online media reports that the new dealer is expected to assist Harley-Davidson in offering spare-parts, accessories and its lifestyle apparels line to new and existing customers.
Harley-Davidson and PT Mabua Motor isn’t the only foreign automotive brand to announce its closure in Indonesia. It comes second only after carmaker Ford – incidentally also an American firm – which announced the closure of its Indonesian subsidiary called PT Ford Motor Indonesia last month.