PT Timor to make 4-wheel drives without tax break

JAKARTA (JP): PT Timor Putra Nasional, a company licensed by the government to make "national" sedans with tax and duty breaks, will launch a four-wheel drive vehicle by next January without any fiscal facilities, an executive said yesterday.

Soemitro Soerachmad, the president of PT Timor Distributor Nasional, Timor Putra's sister company and sole distributor, said yesterday the four-wheel drives would be assembled at Timor Putra's assembly plant in Bekasi, West Java.

"The four-wheel drives will have a local content of about 40 percent," he said after a ceremony launching the Timor MasterCard.

Timor MasterCard, introduced in cooperation with Malaya Borneo Finance of Malaysia, can be used in Greater Jakarta to buy spare parts for Timor cars.

"The price of the four-wheel drives hopefully will be less than Rp 40 million (US$16,576)," Soemitro said.

He said Timor Putra, which used to import its Timor S515 from South Korea's KIA Motors Corp, had started trial production in cooperation with Indomobil Group with a local content of 8 percent.

Timor Putra is owned by President Soeharto's youngest son, Hutomo Mandala Putra.

Soemitro said the company, which has so far made 2,000 sedans, would start commercial production by next month.

"Hitherto, we have sold about 12,500 cars. About 60 percent of them were sold in Greater Jakarta," he said.

"This Friday we are also going to launch a new series, S515i, equipped with an injection ignition system, with 8 percent local components. Hopefully by December the local contents will increase to 20 percent," he said.

He said his company still had about 5,500 S515 series cars, all of which would be sold by June.

The company expects to sell about 40,000 Timor cars by December.

Soemitro said Timor car sales, which fell from 3,259 units in January to 962 in February because of Idul Fitri, bounced back to 1,300 units in March.

"We expect the sales will remain flat at about 1,300 units in April and May because of the general election," he said.

Responding to rumors that Timor cars had a low resale price, he said his company would open a used Timor car dealership in cooperation with a leasing company to support prices. (10)