Smuggling hurts local tiremakers

Smuggling hurts local tiremakers

JAKARTA (JP): The Association of Indonesian Tire Producers
(APBI) is attributing July's 10 percent drop in monthly sales of
locally produced tires to the influx of smuggled products from
China.

The Chinese goods are cheaper than the local tires, which sold
about 600,000 units for the month, APBI chairman Aziz Pane told
Bisnis Indonesia on Thursday.

Brands such as Double Happiness, Quin Lin, Advance, Great
Wall, Tai San and Chang Chen have been found in Jakarta, Medan,
Semarang, Surabaya, Bandung and other major cities, Azis said.

They entered the country through Batam Island, south of
Singapore, and bypassed customs control as they were distributed
to other parts of the country.

Fierce competition already exists among major producers with
local operations, including Goodyear, Bridgestone and Gadjah
Tunggal.

The plunge in the value of the rupiah since the financial
crisis began in 1997 made the products costly for most motorists.
Many have sought cheaper alternatives, including smuggled tires.

Aziz warned car owners that the smuggled products were
inferior and below national safety standards. The tires could be
dangerous, especially at high speeds or with overloaded vehicles.

APBI had already reported the problem to the Directorate
General of Customs and Excise and the Ministry of Industry and
Trade.

Customs officials said they had limited power to curtail
smuggling and insisted that the onus lay with the the police to
control the sale of the tires.

APBI previously complained about the import of used tires from
Singapore, which it said hurt local producers. They enter through
Medan and Jakarta in 40 containers, totaling about 48,000 units,
each month. (02)