Daewoo to launch Nexia here next month
By Matthew Allen
PT Starsauto Dinamika, the local assembler and distributor for South Korean carmaker Daewoo, will launch the Nexia next month despite reports that the company is downgrading its operations here.
The car, displayed earlier this year at Auto Expo 96, will enter the extremely competitive small sedan market.
Starsauto's vice president director, Darwin Maspolim, said the enthusiastic response the car received at the auto show convinced the company that it should launch the Nexia.
"We were surprised by the responses we gained from our customers and the interest in our DOHC engine compared to that of Suzuki, Honda and Hyundai," Darwin said.
"We already have 500 orders for the Nexia and aim to sell 2,500 per year.
"We cannot fulfill all our customer orders by January but we hope to have the balance of the Nexias delivered by April, 1997," he said.
Master plan
Initially, Indonesia was part of Daewoo's master plan and was touted as its right-hand drive production base for the Southeast Asian and Australian markets.
However, the effect of the government's automotive policy and the controversy surrounding the Timor national car caused Daewoo to review its investment here.
The company now plans to assemble and sell only about 3,000 cars per year, down from earlier forecasts of about 20,000.
"Under the present circumstances we are only servicing the domestic market and evaluating case-by-case investment opportunities in the components industry, not stamping and machining like our previous plans," Darwin said.
"Priority should be given to the component industry and this is Indonesia's weakness. We should improve our component industry to serve most of the car manufacturers worldwide," he said.
The Nexia 1500cc engined base-model sedan will be launched next month priced at Rp 40.5 million off-the-road.
For an extra Rp 2.5 million, the Nexia can be fitted out with central locking, power windows, power steering, metallic colors, audio cassette and extra rust protection specifically for Indonesia's road conditions.
Cost
The complete car off-the-road will cost Rp 43 million, competing directly against Suzuki's new Baleno in the ever- increasingly heavily populated sedan market.
This category has been even more competitive this year as more players vie for reduced sales.
Last year the total sedan market was just under 38,000 cars. To the end of October this year, the sedan market had reached less than 27,000 cars.
Darwin was confident that the sedan market would reach 40,000 cars next year and the total market, more than 600,000 by 2000.
Sales in the sedan market segment like the remaining market categories this year have suffered due to the tight monetary policy and the national car issue.
"We believe that the segment shows great potential and Daewoo wants to increase its sales and grow in the market," said Darwin.
"We aim to step up our presence in the market by extending our distribution and after sales network and continue to serve the customer and build, step by step, the Daewoo brand.
"For example, our 24-hour service is already established in Jakarta and Surabaya. Last month we set up another dealership in Banda Aceh," he said.
Currently, Daewoo has 23 outlets in Indonesia.