Kia of S. Korea to produce cars in Indonesia
Kia of S. Korea to produce cars in Indonesia
JAKARTA (JP): Kia Motors Corp. is joining two other South
Korean car makes, Hyundai and Daewoo, in the Indonesian market
which already contains more than 18 other makes.
Kia Motors announced yesterday its joint venture, called PT
Kia-Timor Motor, with PT Timor Putra Nasional, a member of the
widely diversified Humpuss group, and PT Indauda, which is also
controlled by Hutomo (Tommy) Mandala Putra, the chairman of the
Humpuss group, and youngest son of the president.
Kia-Timor will establish a car assembling plant in Cikampek,
West Java, where Hyundai has already set up its assembly plant.
"We will invest US$260 million in the project," Chairman of
the Humpuss Group, Tommy, told journalists yesterday after
reporting to President Soeharto on the new car joint venture.
Meanwhile, a Kia spokesman was quoted by Reuters as saying in
Seoul yesterday that Kia had decided to scale up its investment
in this project to a total of $1 billion by the year 2000.
The spokesman said that Kia had a 30 percent stake in Kia-
Timor and that Tommy, through Timor Putra and Indauda, controls
the remaining 70 percent stake.
A rally driver himself, Tommy has a majority stake in two
noted sports car makers: Lamborghini S.p.A. in Italy and Vector
in the United States.
Tommy, president commissioner of Timor Putra, explained that
the company will launch Timor S515 and Timor S515i sedans with
1,500 cc engines and Timor J520i, recreational multi-purpose cars
with 2,000 cc engines and DOHC multi-point injection engines.
To mark the launching of its cars, branded Timor, Kia-Timor
yesterday presented ten prototypes of the Timor car to Soeharto,
who donated the cars to the Jakarta police.
At yesterday's meeting with Soeharto, Tommy was accompanied by
the president of Kia Motors Corp., Kim Sung Hong.
Tommy explained that the Timor sedan will be the Indonesian
model of Kia's compact model Sephia, while the Timor jeep will be
similar to Kia's utility car model Sportage.
"Putra Timor Nasional plans to produce the next generation of
Timor cars itself so that they will bear Indonesia's copy
rights," Hutomo said.
He said Timor cars will be sold at half the price of the
Japanese automobiles or one third cheaper than the price of other
Korean cars of the same class and type.
The 1,600-cc Japanese sedans like Toyota Corolla, Honda,
Mitsubishi Lancer and Mazda are sold here with prices ranging
from Rp 60 million (US$25,860) to Rp 80 million.
Meanwhile, the 1,500 cc Hyndai Elantra Sedans come with a
price tag of Rp 59 million each, while the 2000-cc Daewoo Espero
sedans sell at Rp 70 million each.
Hutomo said the Cikampek assembling plant will have the
capacity to produce 50,000 units of sedans and jeeps next year.
This capacity will be doubled to 100,000 units in 1998.
He said the Cikampek plant will become a center for producing
right-hand-drive cars to be exported to countries with the
steering wheel on the right side, such as Australia, Britain and
Ireland.
Hyundai entered Indonesia through a joint venture with PT
Citra Mobil Nusantara, a subsidiary of the Bimantara Group which
is controlled by Soeharto's second son Bambang Trihatmodjo.
Daewoo teamed up with PT Starauto Dinamika. (rid)