Chinese to boost quality of motorbikes

Chinese to boost quality of motorbikes

Rendi A. Witular, The Jakarta Post, Jakarta

Competition in the country's motorcycle market will become
fiercer in the future as China gears up to boost the quality of
its products but at the same time maintain their cheap prices,
according to an executive of the industry.

Chairman of the Indonesian Motorcycle Industry Association
(AISI) Ridwan Gunawan said that Chinese motorbike makers were
learning quickly from the disappointing performance of their
products here.

"They will improve the quality of their products. I predict in
the near future their product will not just be cheap but also
reliable. Thus, they surely will undermine the domination of
Japanese motorbikes in the (local) market," said Ridwan.

Chinese-made motorbikes caused nervousness among Japanese
producers when they managed to grab a 20 percent share of the
Indonesian market during their debut here in the late 1990s. In
comparison, Honda, which has long been established in the
Indonesian market, controlled a 50 percent market share.

Analysts have said that the Chinese-made bikes managed to grab
a significant market share in their early days because of their
low prices, at Rp 3 million to Rp 5 million each, only half the
price of Honda products.

However, as many later complained about the quality of the
motorbikes, sales of the Chinese-made products started to drop.
Sales for this year are projected to reach only 150,000 units,
compared with more than 200,000 units in 2000.

The decline was mainly attributable to the low quality of the
products and relatively poor after-sales service compared with
that of Japanese brands.

At least 57 brands of Chinese motorcycle entered the
Indonesian market after the government eased regulations on the
import of completely built-up motorcycles in late 1990s.

But, as of now, only 10 Chinese brands have survived.

Ridwan was, however, convinced that the Chinese motorbikes
would, in the near future, regain popularity with Indonesian
middle- to lower-income families.

They would become a serious threat to the Japanese brands,
which control Indonesia's motorcycle market of 2.5 million units.