Motorcycle Parts Business Under Pressure: Rising Production Costs and Relocation Issues

The General Secretary of the Indonesian Automotive Parts and Components Industry Association (GIAMM), Rachmad Basuki, has revealed the impact of global geopolitical turmoil and rising world oil prices on the national automotive industry. For producers of car and motorcycle parts, the scarcity of raw materials and the increase in oil prices, affecting materials such as plastics, oil, and lubricants, have caused production costs to soar. However, pressure on consumer purchasing power means these raw material price hikes cannot be fully transmitted to component prices, thereby squeezing business margins. GIAMM also noted that the weakening of the Rupiah exchange rate has driven up the cost of importing raw materials. On the other hand, the issue of factory relocation is also haunting the Indonesian automotive business climate.