Bakrie Group targets SE Asian, European marts

Bakrie Group targets SE Asian, European marts

By Rikza Abdullah

PRESTON, Britain (JP): Aburizal Bakrie says his vans, which he
hopes to launch late next year, will be targeted not only at the
Indonesian market, but also Southeast Asian and European markets.

The chairman of the diversified Bakrie Group told reporters
here that with testing approval from the Leyland Technical
Center, his vans should be able to penetrate overseas export
markets.

"When accompanied by testing approval from Britain, we hope it
will be easier for the vans to get roadworthiness certificates
from European countries." he said.

Aburizal was in England last week to test drive the first of
several prototypes for his vans that are being developed by the
British Leyland unit.

The 2,000 cc engine for the Bakrie vans use chiefly European
technology but will be produced and assembled by PT Bakrie Motor,
a unit of Bakrie Investindo, in Indonesia starting next June.

Aburizal said the vans will have no less than 40 percent local
content in the first year of production, rising to 50 percent in
the second and to 60 percent in the third year under the
weighting system set by the government.

"The government's way of calculating local content does not
really indicate the exact figures because it is not based on
prices," he said. "If the calculation is based on the prices of
components, our vans' local contents would reach 60 percent in
the first year of production."

If the Bakrie vans are recognized to have a 60 percent local
content level, they will have the right to enjoy fiscal
facilities from the government and their prices could be lowered,
he said.

Under government rules, producers of multi-purpose vans and
commercial vehicles are exempt from import duties on components
and luxury sales tax if their local content reaches 50 percent.

Without such fiscal facilities, Bakrie vans will be sold for
between Rp 38 million (US$16,170) and Rp 60 million, depending on
the specifications requested by buyers.

Aburizal said that preparations started in 1993 with a
feasibility study involving European automotive experts grouped
in the Singapore-based Global Automotive Design & Technology.

Bakrie Investindo's automotive project director, Basoeki
Soebiakto, said the vans will be assembled at the industrial
facility of PT Ningz Pacific Motor, a Lippo Group subsidiary
where Bakrie Investindo has a 10 percent stake.

The chassis and body plates will be produced by Bakrie Motor
and brake systems by PT Bakrie Tosan, while the other components
will be ordered from independent companies, including PT Dasa
Windu Agung, PT Kayaba, PT Nippon Denso Indonesia, PT Inou Rubber
and PT Bridgestone Indonesia.

Aburizal said Bakrie Investindo has invested $15 million in
the prototype's development, and will need to contribute another
$5 million before manufacturing starts. The company will invest
$100 million to establish Bakrie Motor's production facilities.

For the marketing and after-sales services, Bakrie Motor will
appoint 26 dealers, required to have their own showrooms and
workshops, throughout the country. "We have received dealership
applications from 20 companies," he said.