Indonesian experience helps to get better idea of the market
Indonesian experience helps to get better idea of the market
Japanese carmaker Toyota Motor Corp. has made Indonesia and
Thailand its bases for IMV (Innovative International Multi-
purpose Vehicle) production in Southeast Asia. Starting in April,
the company began increasing its production capacity in both
countries for exports to 100,000 and 350,000 units respectively.
In conjunction with the Tokyo Motor Show, groups of journalists,
including The Jakarta Post's Primastuti Handayani, interviewed
Toyota's President Katsuaki Watanabe and the company's Senior
Managing Director for Asia, Oceania and Middle East Operations
Group Akira Okabe. The following are the key points from the
interview:
Question: In terms of investment, why do you prioritize
Thailand more than Indonesia, considering that Indonesia has a
long history with Toyota?
Katsuaki Watanabe (KW): We have a long history operating in
Indonesia and we have been doing very well in the country. We
have the IMV project in Indonesia. We have invested and have been
expending our operation in the country.
Please, always keep in mind what is the demand of the local
market in the future and that is the basis of our production.
What is your plan for Indonesia in the next five years?
KW: I don't have the concrete figure that I can share with you
at the moment, because that is considered as a confidential
information for the company. So, that is hard for me to cite the
concrete number.
But as far as Indonesia's operation is concerned, we have --
under the IMV project -- produced with Daihatsu, the Avanza and
Xenia vehicles, respectively.
In the context of IMV, Indonesia is regarded as a very
important production base for those vehicles, including Kijang
Innova.
Does the recent economic condition, sparked with high prices,
influence Toyota's production policies?
KW: At the moment, skyrocketing oil prices or soaring
materials prices have not directly impacted our production or
costs. That is not the case at the moment. But if the high oil
prices remain for a long time, that will impact the entire world
economy.
Should that be the case, of course, that will have negative
implications in many aspects and I'm concerned with the
possibility.
In accordance with that, can Toyota as the number two carmaker
in the world interfere with the OPEC (Organization of Petroleum
Exporting Countries) pricing policy?
Akira Okabe (AO): As many economists have said, the current
level of oil prices is not like before. In a sense, the impact
should not be so big. So, there's no need to change the policy.
But, following the Toyota Way (the company's 14 foundational
management principles behind its 'lean-production' system), we
should consider which is good for the environment and good for
fuel efficiency.
Do you see the possibility of hybrid cars being produced
outside Japan to cut costs? Perhaps in other Asian countries?
KW: I think Asian countries could be potential candidates (for
the production). But at the moment, it's difficult for the hybrid
cars to be produced overseas because they require very
sophisticated materials, sophisticated machine activities.
Even in Japan, it's difficult to produce those components. We
are working and operating under very limited resources in that
context. As the volume of hybrid cars increases, it may be
possible to assemble those vehicles in other parts of the world.
How do you see Toyota in the next five years, in terms of
capturing the market for hybrid cars in the world?
KW: Our plan next year is to produce and sell around 400,000
units. By 2010, we plan to produce about one million hybrid cars.
Who is your biggest competitor for Toyota in Indonesia?
AO: The Toyota Way encourages us to always get new ideas. The
competitor is ourselves. If we are satisfied with ourselves, that
is a big problem. So, (we) always improve ourselves.
For the last 25 years, Indonesia's market has been given the
Kijang with simple technology, compared to other carmakers which
already offered more advanced technology. Why?
AO: Every vehicle has its own character, given by the makers
based on customer demand, such as Lexus, Crown, Kijang Innova and
Avanza. We should always follow the mainstream of the industry.
Kijang has long been identified with Indonesian people.
But a Kijang is no longer affordable for Indonesians...
AO: That's why we introduced the Avanza.
Is it true that you are using Indonesia as a pilot project for
that kind of market?
AO: That's our aim, but having Indonesia's experience is very
good for us, to get the idea of the market. We very (much)
appreciate Indonesia.