BMW to assemble new 5 Series here

Primastuti Handayani, Jakarta

To meet the great response from the local market, PT BMW Indonesia signed an agreement with PT Astra International Tbk. on Tuesday to locally assemble the new BMW 5 Series at Astra's PT Tjahja Sakti Motor (TSM) plant.

"We are confident about the Indonesian market. The 5 series has been our volume model and received great response from the market," President Director of PT BMW Indonesia Josef Honsel told a press conference.

BMW sold 180 units of 530i Completely Built Up (CBU) cars in March alone. In 2003, 2,149 BMW cars were sold in Indonesia, or around 45 percent of the luxury car market.

"Since the CBU import duty is 70 percent while the locally assembled import duty is only 15 percent, we consider it worthwhile to assemble this car in Indonesia," said Astra Director Prijono Sugiarto.

TSM has assembled the BMW 5 series since 1976. The new 5 Series will be the first new model BMW will assemble locally since the 1997 monetary crisis. For the new 5 Series, Astra will invest around Rp 50 billion (US$5.78 million) for its "body shop".

Twelve production experts from BMW AG Germany are in town to support TSM in preparing the assembling process.

The locally assembled 5 Series will be available in two models: 520i and 530i. They will be launched in July.

Honsel declined to mention the sales target of the locally assembled new 5 Series or its price, but said that the price would be lower than the CBU model which is tagged at Rp 997.2 million on the road.

The new 5 Series, which was revealed to the public for the first time in the 2003 Frankfurt International Motor Show, introduces lightweight engineering technology for the model's steel and aluminum structure.

Indonesia is the fourth country to assemble this vehicle, following China, Thailand and Malaysia.

Prijono said that the assembling plant lines could produce 16 cars per day.

"It's quite big for the luxury car market segment. However, we can expand our capacity, depending on the demand."