Indian motorbikes roar into Indonesian market
JAKARTA (JP): Indian motorbike manufacturer Hero-Puch of the Hero Group introduced here on Monday the Motorilenia, officially entering the competition for the country's growing motorbike market.
Setia Abednego, the president of PT KANCIL, the sole distributor of the Motorilenia, said he was upbeat the Indian motorbike would succeed in competing with such established names as Honda, Yamaha, Kawasaki and Suzuki.
"We are targeting particular segments such as the scooter and general motorbike markets," he said during a break in the launching ceremony, adding that the company expected to sell about 5,000 units per month.
Motorilenia, imported from India completely built up, comes in two models, the Mallika and Winner, each with an engine capacity of 75cc. They will be priced at between Rp 7.5 million (US$937) and Rp 9.5 million on the road, much less expensive than Japanese brands.
Setia said Motorilenia was produced by Indian motorbike manufacturer Hero-Puch, which has production bases in Argentina, Brazil, Colombia, Iran, Mauritius and Nigeria.
He said his company and Hero-Puch planned to open an assembly plant in Indonesia to better compete against existing motorbike brands.
The companies have allocated about $15 million in initial investment for the marketing of the Motorilenia and to construct the assembly plant, he said.
"We plan to import the Motorilenia for six months only, before the company is able to assemble (the motorbikes) locally," he said.
Indonesia places restrictions on the import of motorbikes to protect the local industry, which collectively has invested approximately $400 million in developing its assembly operations.
The diversified business group Bosowa Group, based in Makassar, South Sulawesi, announced earlier its new motorbike assembly plant in Karawang, West Java, would begin commercial operations in April.
Bosowa Group, in cooperation with South Korean motorcycle manufacturer Hyosung Motors & Machinery Inc., has invested approximately $20 million in the plant.
The group said it would produce about 10,000 motorbikes this year with engine sizes of between 50cc and 125cc.
Another company has begun selling Chinese motorbikes in an effort to capitalize on Indonesia's huge motorbike market.
Indonesia's motorcycle market, the world's third largest after China and India, suffered a major setback in 1998 when the economic crisis struck.
Domestic sales plummeted from 1.88 million units in 1997 to 430,948 in 1998 as a result of the crisis.
The industry began to show signs of recovery last year with total sales rising to 487,759 units, according to data from the Association of Indonesian Motorcycle Sole Agents and Manufacturers.
The association predicted motorcycle production would increase to 700,000 units this year. (cst)