Indonesia's car production to surge to 1.5 million units per year

Source:Xinhua Published: 2012-7-13 16:28:23

Production capacity of car manufacturers operating in Indonesia is projected to surge 66.67 percent to 1.5 million per annum from the existing 900,000 units following the implementation of investment expansion commitments of five Japanese carmakers in Indonesia, a senior official said here on Friday.

"Those five carmakers would expand their production by totally 600,000 units per year, requiring a total investment of 2.31 billion US dollars that will be materialized gradually," High Technology-basis Products Director General at the Industry Ministry Budi Darmadi said here.

Those five Japanese carmakers that have conveyed their production expansion plans in their Indonesian plants were Toyota, Nissan, Suzuki, Daihatsu and Mitsubishi.

Budi said that Toyota has pledged to add 534.4 million dollars of investments in the country, expanding its production by 120,000 units in two phases. Meanwhile, Suzuki would add some 782.63 million US dollars in its Indonesian plant to expand production by 100,000 units per year.

Daihatsu Motor Co. to add some 233.3 million US dollars to produce 100,000 more units in its Indonesian plant.

Mitsubishi Motor Co. has pledged to increase its investments by 27.8 million US dollars, aimed at expanding its production up to 162,000 units per year. Nissan Motor Co. would also place 400 million US dollars of investment in its Indonesian production facility, expanding production up to 250,000 units per year from the existing 80,000 units, the Antara news agency reported.

Budi said that the car production expansion figure this year has broke the country's record in the last nine years.

13 car manufacturers are operating in Indonesia at the moment with total assets of 18.9 trillion rupiah (about 2 billion US dollars), employing 27,270 people. The assets of those manufacturers are expected to reach 40 trillion rupiah, 50,000 employees in the next four years.

Indonesia has been chosen as the foreign production basis of several carmakers as it provides competitive production costs and promising lucrative markets as the largest economy in the Southeast Asia has apparently turned to an emerging market with growing economic growth amid crisis that battered global economies in the last few years.

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