Bakrie Investindo permitted to produce vans next year

JAKARTA (JP): PT Bakrie Investindo has received a permit from the Ministry of Industry and Trade to produce vans next year with an investment of about US$100 million, the company's president said.

"We received the industrial permit last week and hope to receive an investment license for the van production from the Investment Coordinating Board next month and a brand permit from the Ministry of Justice in six months," Anton Setianto told reporters here Friday

The van's brand name will be Bakrie, he said.

The company is scheduled to start trial production of its car in September,1997 and to launch it in December 1997, Anton said.

He said he was optimistic that all the required legal procedures and pre-production processes will be completed on time, so that the launching will be conducted on schedule.

Bakrie Investindo, the investment arm of Bakrie Group, was recently reported to have had difficulties obtaining permits from the government for its planned manufacture of vans. Reports speculated that the government did not want the Group to disturb the plans of PT Timor Putra Nasional, owned by President Soeharto's youngest son Hutomo (Tommy) Mandala Putra, to produce a national car.

Anton denied that his company had such difficulties, and said that the process of obtaining the permits would run smoothly.

The car-making plan dates back three years and the first test drive of its prototype by Bakrie Group's president Aburizal Bakrie was conducted in August at the Leyland Technical Center in Preston, Britain.

"The prototype still needs another 1,000 trials to ensure that it is of the best quality before it is launched," said Anton.

Bakrie Investindo's employees designed the vehicle in conjunction with the Britain-based Creative Automotive Design.

The van will be produced at the PT Ningz Pacific Motor plant in the Lippo Industrial Estate in Cikarang, West Java, where Bakrie Investindo holds a 10 percent stake. ST-Logistics Singapore will support it by supplying components.

The planed van, to be equipped with a gasoline engine of 2000cc or diesel engine of 1,900cc, is designed to hold eight passengers and have its gears on the dashboard. It will use multi-source components, including Peugeot engines from France.

Bakrie vans will be sold at between Rp 35 million (US$14,830) and Rp 60 million ($25,423) have reportedly attracted many distributors even though production is still a year away.

"Tens of domestic distributors have applied to distribute our vans. One application has come from Malaysia," he said.

Anton said the Bakrie car project is wholly owned by Bakrie Investindo, which has invested $20 million in the design and production of prototypes.

The company aims to sell 10,000 vans in the first year of production, 15,000 units in the second year, and between 18,000 and 19,000 units in the third year. In the fourth year, the company hopes to reach a break-even point.

Anton said the local content of the planned van will reach 40 percent in the first year of production, 50 percent in the second year and 60 percent in the third year. (jsk)