Rini Soewandi revs up Indonesian motorcycle industry

Rini Soewandi revs up Indonesian motorcycle industry

JAKARTA (JP): Rini M.S. Soewandi, one of Indonesia's highest
paid professional managers, has plunged some of her own money
into a new motorcycle manufacturing start-up to challenge
Japanese giants and cheap Chinese imports early next year.

The former CEO of PT Astra International announced on Friday
that her Kanzen motorcycles should start coming off the
production lines in February.

PT Semesta Citra Motorindo, the $5-6 million company which is
to produce the motorcycles, hoped to produce and sell 66,000
units in 2001, or 5,500 units per month, Rini said.

"If I wasn't sure, I would not have invested so much time and
resources," she told reporters at a ceremony marking the signing
of a memorandum of understanding between her company and the
Agency for Technological Research and Application (BPPT).

Rini, who is the chief commissioner of Semesta, holds a 60
percent equity stake in the company.

Under the five-year contract, BPPT, a government research
agency, will undertake the research and development of motorcycle
engines for Semesta.

Indonesia's motorcycle market has rebounded this year with
total sales likely to exceed 800,000 units, more than double the
1999 figure. Annual sales reached 1.8 million units prior to the
1997 financial crisis.

The Indonesian market has long been dominated by Japanese
makes such as Honda, Yamaha, Kawasaki and Suzuki. But over the
last two years, the domestic market has been flooded by more than
40 Chinese makes. Chinese imports now account for more than 20
percent of the market.

Rini said Kanzen would be competitively priced against
Japanese brands, but not against the Chinese imports.

While Semesta could not undercut Chinese prices, Rini said she
hoped to gain an edge through quality, noting that some of the
new and cheaper motorcycles currently on the market were of poor
quality.

Semesta will launch three different motorcycles in February,
all prized at less than Rp 10 million, she said.

Kanzen had been developed with the help of the BPPT on an
informal basis until Friday, when the arrangement was finally
formalized.

Rini disclosed that she and the BPPT deputy chief of design
engineering technology Said D. Jenie, who is helping in
developing Kanzen, went back a long way together, to their
college days in Boston, Massachusetts, in fact.

She conceded that Semesta's success would depend to a large
extent on BPPT helping to develop its products.

"Setting up a motorbike plant is a huge undertaking in terms
of the investment in research and development that is required,"
she said.

Semesta has outsourced this part of the work to BPPT,
specifically the agency's Laboratory for Motor Thermodynamics and
Propulsion Systems. (03)