Indomobil to focus on car retailer

JAKARTA (JP): Publicly listed car manufacturer and importer of various car brands PT Indomobil Sukses Internasional said on Thursday that it would leave the car importing business and would instead focus on becoming a car retailer.

Indomobil president Soebronto Laras said the company planned to persuade the automobile manufacturers to take over the import operations of the various car brands the company was currently selling, except for Suzuki, which Indomobil assembled in Indonesia.

He said the move would allow Indomobil to transfer its foreign exchange risks as an importer for the company's various car brands.

Speaking at Indomobil's public expose, Soebronto said that the company would buy the imported cars at local prices.

"We're now sorting out the types of car brands we would like to focus on," he said without saying when Indomobil would switch its business focus.

Indomobil is the authorized dealer of various car brands comprising Suzuki, Nissan, Mazda, Hino, Volvo, Audi, Volkswagen, and Ssongyang.

Soebronto did not say how the policy would effect current owners of Indomobil's cars, and whether the prices of these cars would change.

According to him, car manufacturers like Volvo and Mazda were interested in directly importing their cars to Indonesia using Indomobil as their distributor.

"We have 1,300 outlets across Indonesia, and we can earn a good profit margin like that for any retailer which doesn't face foreign exchange risks," he explained.

As for Suzuki, he said, the company would strengthen its production facilities as part of plans to cope with a free market.

"In fact we hope we can become an export base for Suzuki," he said.

Soebronto said that Indomobil planned to cooperate with other Suzuki producers in the region to jointly market their cars.

Indomobil is also expecting to complete its debt restructuring negotiations within the first semester of this year.

The company's finance director Erick Kartawijaya said Indomobil would offer foreign and domestic creditors a debt restructuring plan using a combination of debt to equity swap and rescheduling.

The company owes Rp 337.4 billion (US$35.51 million) to PT Holdiko Perkasa.

Holdiko is a company established by the Indonesian Bank Restructuring Agency to manage companies surrendered by the Salim Group to the agency as payment of its massive debts to the government. The companies polled at Holdiko include Bank Central Asia (BCA).

Erick said that Indomobil owes an additional Rp 263 billion to IBRA as a result of loans taken over from other local banks. The company has also $90 million in debts to Marubeni, $2.3 million to Societe Generale, and $22 million and 1.85 billion yen to IMG Sejahtera Langgeng.

According to Erick, most of the debts belong to Indomobil's 69 subsidiaries.

Indomobil is 72.6 percent owned by Holdiko, 20.5 percent by PT Tritunggal Intipermata and the rest is owned by public investors.(bkm)