Suzuki Indomobil to start making eco cars in April

JAKARTA. Major carmaker Suzuki Indomobil is confident it can begin the production of low-cost green cars (LCGCs) between April and May 2014 following the completion of its new plant at the Greenland International Industrial Center in Cikarang, West Java.

Suzuki Indomobil — a joint venture between Suzuki Motor Corp. and Indomobil Group — plans to manufacture 100,000 units of the efficient cars in the initial phase of production, which will consist of four types, according to Indomobil president commissioner Soebronto Laras.

“There will be the standard and automatic types for sure, but there will also be other more advanced types to facilitate consumer demands,” he said at the Industry Ministry in Jakarta on Wednesday.

Prototypes of the green cars were expected to be available for showcase during the next Indonesia International Motor Show (IIMS) in Jakarta in September, he added.

Soebronto said production might even begin sooner, before year-end, should the company decide to produce the green cars at its existing plants. It currently operates several manufacturing and assembling plants, located in Cakung, East Jakarta; and Tambun, Bekasi.

Suzuki Indomobil’s total production capacity stands at 210,000 units per year. According to Soebronto, the new plant — worth US$1 billion — will have an annual car production capacity of around 150,000 to 200,000 units and will fully operate in the first quarter of 2014.

“Besides cars, it will also produce automotive components for both Suzuki’s cars and motorcycles,” he added.

Suzuki Indomobil is one of several major carmakers which have expressed their interest in joining the government’s so-called “eco cars” project. The others include Astra Daihatsu Motor, Toyota Astra Motor and Nissan Motor Indonesia, which is a joint venture between Nissan Motor Co. Ltd. and Indomobil Group.

For the carmakers to be eligible for a zero sales tax, the government has issued a regulation, which rules that the price of an eco car must not exceed Rp 95 million ($9,225) each. It also sets the capacity limit at between 980 cc and 1,200 cc for gasoline-powered cars and a maximum 1,500 cc for diesel-powered ones.

Davy J. Tulian, the sales director of Suzuki Indomobil Sales, said the company expected to still maintain at least a 15 percent share in the country’s car market by year-end, despite experts’ prediction that sales would be lower in the second half. “So far, our progress is still on the right track,” he said.

The Indonesian Automotive Industry Association (Gaikindo) has estimated that national car sales will reach around 1.2 million units in 2013, rising by about 10 percent only, lower than the 24.8 percent growth recorded in 2012.

With a 15 percent market share target, Suzuki is expected to sell 180,000 units this year, up from 126,577 units in 2012.

According Suzuki, between January and June, its sales reached 75,452 units, 46.6 percent higher than the same period last year. The June sales figure was its highest during the first six months, standing at 29,356 units.

The company says the Ertiga type contributed the most to the first half sales with 6,555 units or 42.1 percent, followed by Carry Futura 1.5 with 29.9 percent and its all purpose vehicle types with 18.6 percent. (Tassia Sipahutar)