Astra to launch cheap sedans by '98: T.P. Rachmat
KARAWANG, West Java (JP): A joint venture between PT Astra International and a Japanese company plans to launch low-priced, 1500-cc sedans by 1998.
Astra's president, Theodore Permadi Rachmat, told reporters here yesterday that the joint venture will invest US$500 million to produce the car, including $350 million to set up its assembly plant.
Astra will have 51 percent of the shares in the joint venture and the Japanese partner, whose name was not disclosed, will control the remaining shares.
The assembly plant will be built on a 500-hectare area at the Kerawang International Industrial City in West Java.
The joint venture also plans to launch cars of a similar type in Thailand next year under the name AFC. The car in Indonesia has yet to be named.
"The cars will look like Honda Civic sedans," explained Aderizal Nazar, president of PT Toyota Astra Motor.
Despite having 40 percent local content at the time of launching, Aderizal said the car will not qualify for the status of national car because it will be produced by a joint venture.
A presidential instruction of Feb. 19, 1996, stipulates that a "national car" must use an Indonesian brand name, be produced by a company wholly owned by Indonesian shareholders and gradually develop domestic technology, engineering and designing capabilities.
The ruling also stipulates that a national car must reach 20 percent local content by the end of the first year of production, 40 percent at the end of the second year and 60 percent at the end of the third year to qualify for three years of tax and tariff breaks.
The government has said that only the Timor car -- produced by PT Timor Putra Nasional, whose owner is President Soeharto's son Hutomo (Tommmy) Mandala Putra -- qualifies for the status of national car. Despite similar plans to launch automobiles with high local content, the models of the Bimantara and Bakrie groups have not qualified under the national car policy.
Astra's chief commissioner, Abdul Rachman Ramly, said yesterday that the commercial vehicles produced by his company, including the Espass and Isuzu Panther, already contain 40 percent to 50 percent in locally-made components.
The company plans to increase the local content to 60 percent in two years.
Meanwhile, Director General of Metal, Machinery and Chemical Industries Effendi Sudarsono yesterday inaugurated the tool and die factory of PT FUJI Technica Indonesia, a joint venture between Astra International (with a 55 percent stake) and three Japanese companies -- FUJI Technica Inc. (25 percent), Nichimen Corp (10 percent) and Itochu Corp. (10 percent).
The factory was built with a total investment of $30 million, including $6 million in shareholder equity and the rest in bank loans.
The factory, located in the Kerawang International Industrial City, produces automotive component-making tools like dies, master models, checking fixtures and jigs, as well as stamping parts.
The joint venture will sell its products on the domestic market for 50 percent to 60 percent less than import prices.
Effendi said that in 1995 Indonesia imported $130 million worth of dies.
In the initial stage, the factory will produce 750 tons of dies and 1,000 tons of stamping parts per year, which will be increased to 1,500 tons of dies and 6,400 tons of stamping parts per year in a later stage. The production of jigs, checking fixtures and master models will start in the later stage. (jsk)