PT Udatin builds assembly plant

PT Udatin builds assembly plant

SURABAYA (JP): PT Udatin, the would-be assembler of Timor
cars, began building its new assembly plant yesterday near
Surabaya's Tanjung Perak port.

Udatin chief commissioner Fritz H. Eman said the assembly
plant would cost around US$30 million to build.

He said the company would produce around 36,000 cars a year,
beginning August 1997.

"All of the car components will be supplied by Timor's
manufacturing plant in Cikampek (West Java)," he said at a
ceremony to launch the project.

Udatin, an Udatinda Group subsidiary, is one of companies
licensed by PT Timor Putra Nasional to assemble Timor cars.

"The project is the first phase of Udatin's long expansion
program," he said. "In the second phase, the company will invest
another $20 million to further increase its assembly capacity."

The government granted in February pioneer status to Timor
Putra to produce a national car with Kia Motors of South Korea,
an exclusive arrangement that will give the company a series of
tax breaks, including exemptions from import duties and luxury
taxes.

The tax incentives, which will last three years, will enable
the company to sell its products for half the price of Japanese
makes of the same class (with 1,600cc engines).

Timor Putra plans to import all car components from Kia Motors
before its own factory opens.

Udatin plans to assemble the cars, while the engines and other
components are to be manufactured by Kia Timor Motor, which is
building a manufacturing plant in Cikampek, West Java, with an
investment of $260 million. (25/hen)