Astra, Honda Motors set up joint venture<\/p>\n
JAKARTA (JP): Publicly listed PT Astra International and
\nJapan-based Honda Motors Corp. Ltd. announced on Wednesday the
\nestablishment of a joint venture in a bid to boost the two
\ncompanies' motorcycle production.<\/p>\n
Speaking at a media conference, Astra president Theodore
\nPermadi Rachmat said the two companies' existing joint ventures
\n-- PT Honda Federal and PT Federal Motor -- would be merged into
\nthe new joint venture, called PT Astra Honda Motor.<\/p>\n
\"(The joint venture) will integrate the two organizations'
\nexisting motorcycle operations in Indonesia and will start
\noperating by January 2001,\" Rachmat said.<\/p>\n
Honda Motor president Hiroyuki Yoshino said he expected the
\nnew joint venture would be developed as a production base for
\nHonda motorcycles to be sold in the region.<\/p>\n
\"With the integration of our motorcycle operations in
\nIndonesia, we aim to enhance our competitiveness through closer
\ncoordination with the Honda network in the ASEAN region,\" he
\nsaid. ASEAN groups Brunei, Cambodia, Indonesia, Laos, Malaysia,
\nMyanmar, the Philippines, Singapore, Thailand and Vietnam<\/p>\n
According to him, Indonesia will regain its position as the
\nworld's third largest motorcycle market.<\/p>\n
Data from Astra shows Indonesia's domestic sales of motorcycle
\nthis year recorded the most rapid growth in ASEAN.<\/p>\n
As of July total motorcycle sales in Indonesia reached 431,000
\nunits, an increase of over 101 percent over the same period last
\nyear. Honda motorcycles made up 54.1 percent of these sales, or
\nsome 233,000 units.<\/p>\n
Yoshino said his company had dominated the Indonesian
\nmotorcycle market for years, with a market share of about 50
\npercent.<\/p>\n
Honda Motor senior managing director Katsuro Suzuki said the
\ncompany would spend about Rp 1.28 trillion to increase its stake
\nin the new joint venture.<\/p>\n
He said the company currently owns a 55 percent stake in Honda
\nFederal, which produces spare parts for Honda motorcycles.<\/p>\n
The remaining 45 percent is owned by Federal Motor, Honda's
\nassembly and distribution company.<\/p>\n
Astra owns 92.5 percent of Federal Motor, with the remaining
\n7.5 percent owned by PT Prakarti Yoga.<\/p>\n
Under the deal, Astra sold a 42.5 percent share in PT Federal
\nMotor to Honda, Rachmat said. Honda will pay Rp 1.28 trillion, of
\nwhich Rp 1.12 trillion will go to Astra and the remainder to
\nPrakarti Yoga, which holds 7.5 percent of Federal Motor, Rachmat
\nsaid.<\/p>\n
Astra will use the funds to pay its debts, which currently
\ntotal around US$1 billion.<\/p>\n
Suzuki said Honda Federal's assets were too small compared to
\nFederal Motors, so that in order to become equal partners in the
\nnew joint venture, Honda Motors must invest another Rp 1.28
\ntrillion. (bkm)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/astra-honda-motors-set-up-joint-venture-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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