JAKARTA. The Association of Indonesian Tire Producers (APBI) accused Cheng Shin Rubber (Xiamen) IND., Ltd (Cheng Shin Tire) is not serious in establishing factory in Indonesia. APBI accused Cheng Shin of importing tires, instead of realizing the establishment of tire factory.
A tire brand of Maxxis, which is imported by Cheng Shin, has penetrated domestic tire market. If this continues, APBI is worried that the imported tires will expand their markets and distract the local tire markets.
In 2012, information was circulating that Cheng Shin will establish tire factory. Cheng Shin has even claimed to invest US$ 400 million to acquire 35 hectare land for establishing factory in Kota Deltamas
The Chinese company is importing tires under the brands of CST Tires, Maxxis, and Sakura for truck, bus, and radial (TB) categories.
“We are suspicious. The Chinese company has two factories here. But the company continues to import with the reason of conducting market trial,” the General Chairman of APBI Aziz Pane told KONTAN, Wednesday (30/11).
Initially, the China-based company will establish two tire factories in Indonesia. However, APBI found that to date the factories have not yet been established. In fact, according to its investment commitment, the factories are supposed to have been established. “The factories, namely Aelous and Cheng Shin have not yet been established,” he said.
Aziz suspected that the licensing of the China-based company has not yet been settled. Therefore, the company continues to import. “It should be confirmed with the Ministry of Industry, whether this practice is allowed or not,” he said.
However, the Director General of Chemical Industry, Textile and Miscellaneous (IKTA) at the Ministry of Industry Achmad Sigit Dwiwahjono said that he did not have information about any Chinese company that will invest in tire factory in Indonesia. "I've never heard the name of his company," said Ahmad, Friday (2/12).
However, Achmad said that the government has required the Indonesian National Standard (SNI) over the tire products, which will be sold in Indonesia. Indeed, the standard is only valid for commercial market.
In responding to the accusation, Nelson Lie, Director of PT Sumber Multi Jaya Nusantara (SMJN), which is also the principal of CST Tires in Indonesia, said that the factories constructions have not finished yet. However, he cannot further explain about the investment, as it is under the authority of the central office.
“We have been here for seven years. There are motorcycle and truck’s tires. We import directly from China or from Cheng Sin. The distribution is throughout Indonesia. Our sales are still few,” he told KONTAN, Friday (2/12).
Meanwhile, Marketing Director of PT Multistrada Arah Sarana Tbk (MASA) Uthan A Sadikin, argued that most of the imported tires from China penetrated the markets for the segments of truck, bus, and radial (TBR). “The locals only produce 10% of the domestic TBR needs, the rests are imported. Michelin produces TBR in Thailand, but sale the products in Indonesia,” Uthan said.
MASA itself only produces 300 pieces of TBR per day. "We cannot meet demand," he said.
(Muhammad Farid/Translator)
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