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🇮🇩 Indonesia /Economy & Trade

Toyota: Middle-Class Economic Pressure Drives LCGC Sales Decline

From Tempo · () Indonesian

Translated from Indonesian, summarized and contextualized by DistantNews.

At a glance

News Named sources Context piece
  • Sales of Low Cost Green Cars (LCGC) in Indonesia dropped 30.6% in 2025 compared to 2024, totaling 122,686 units.
  • Toyota-Astra Motor attributes the decline to pressure on the middle class's purchasing power and economic conditions, not just competition.
  • LCGC sales are expected to recover with economic growth, as the segment primarily serves first-time middle-class buyers and contributes to domestic component standards.

Sales of Low Cost Green Cars (LCGC) in Indonesia saw a significant 30.6% decrease in 2025, with 122,686 units sold compared to 176,766 units in 2024. This downturn is primarily linked to the economic pressures faced by the middle class, according to Jap Ernando Demily, Vice President Director of PT Toyota-Astra Motor.

The decline in LCGCs is more due to purchasing power factors and the current economic conditions of the middle class, not solely because of competition from other types of cars.

— Jap Ernando DemilyVice President Director of PT Toyota-Astra Motor explaining the reasons for the drop in LCGC sales.

Demily stated that the decline is "more due to purchasing power factors and the current economic conditions of the middle class, not solely because of competition from other types of cars." He expressed optimism that LCGC sales would rebound with improved economic growth. The LCGC segment is crucial for first-time car buyers, who predominantly belong to the middle class.

LCGCs are designed to be environmentally friendly, focusing on emission reduction and fuel efficiency. Their domestic production also supports the government's requirement for increasing local content (TKDN). These vehicles represent a substantial portion of the national car market, accounting for over 15-20% of total sales.

LCGC sales will rise again in line with good economic growth.

— Jap Ernando DemilyVice President Director of PT Toyota-Astra Motor expressing optimism about future LCGC sales.

Toyota and Daihatsu, under PT Astra International Tbk, have historically dominated the LCGC market, holding 74.29% in 2024 and increasing to 77.97% in the first half of 2026. Honda's market share has seen a slight decrease over the same period.

Above 15-20 percent of the total market.

— Jap Ernando DemilyVice President Director of PT Toyota-Astra Motor on the market share of LCGCs in Indonesia.
DistantNews Editorial

Originally published by Tempo in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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