Daihatsu Motor to produce 5 million cars

JAKARTA. Major automobile manufacturer Astra Daihatsu Motor (ADM) may produce 5 million vehicles next year, a move that would strengthen its position as Daihatsu’s biggest production base outside Japan.

Prijono Sugiarto, the president director of ADM’s parent company, Astra International, said the group had approved a plan to produce a new model that would be manufactured locally starting from next year to help meet its target. The development of the model will cost around Rp 1 trillion (US$76.06 million).

In line with the plan, ADM would try to gradually boost its exports until it reached 30 percent of total production from a current level of 15 percent, Prijono added.

“I think we are on the right track to achieve that,” Prijono said Thursday during a ceremony to mark ADM’s production of 4 million units.

Starting local assembly in Indonesia in 1978, ADM now runs two facilities, including an engine plant, in Sunter, North Jakarta, and Karawang, West Java, with overall annual capacity of 530,000 units It sources autoparts from 216 first-tier suppliers and 1,105 second-tier suppliers.

Apart from making cars for Daihatsu, the plants also assemble vehicles for Toyota. As of May, ADM has made 2.08 million vehicles for Daihatsu (51. 9 percent) and 1.92 million for Toyota (48.1 percent).

The company exports to 48 destinations in Asia, the Middle East, Africa and South America.

ADM president director Sudirman Maman Rusdi said that the 5 million target would likely be achieved, as the firm could produce 430,000 units this year and another 530,000 units next year in line with recovering market demand.

The new model that it intended to produce would be sold under both Toyota and Daihatsu brands, he added.

“We haven’t decided yet whether to produce it in the Karawang or the Sunter plant. But all of our plants can produce any model according to demand,” Sudirman said.

ADM and Toyota have previously collaborated on a number of models, such as multi-purpose vehicles Daihatsu Xenia and Toyota Avanza and low-cost green cars Daihatsu Ayla and Toyota Agya.

ADM, Sudirman went on, would also employ its research and development (R&D) center in Karawang to build the new product.

ADM aims for its R&D center to be capable of carrying out full model change by 2019. (Linda Yulisman)