Strike cuts Astra's output by 1,500 cars

JAKARTA (JP): Production at giant car assembler PT Astra Toyota Motor (TAM) dropped by 1,500 vehicles in March due to a two-week strike by workers at one of its suppliers, an executive at TAM's parent company PT Astra International confirmed on Thursday.

Astra corporate secretary Aminuddin said that because of the strike, TAM's output in March reached only 5,000 vehicles from its normal output of between 6,500 to 7,000 vehicles.

Aminuddin, however, dismissed media reports saying that TAM had suspended assembly at its plants because workers at one of its seat suppliers, PT Kadera-AR, were on strike.

"We've experienced only a minor interruption. I don't think the 1,500 vehicles are a significant loss," he told The Jakarta Post.

He added that TAM would resume normal production on Monday, as the company had assigned other seat-makers to fill in for Kadera.

TAM, he said, could use six or seven seat-makers, which were now increasing production to meet the seat shortfall caused by Kadera's problems.

The drop of 1,500 vehicles were of various models, as Kadera produced seats for different cars TAM assembled, he explained.

TAM operates two assembly plants, namely one in Sunter, North Jakarta, and one in Karawang, West Java.

TAM opened its Sunter plant in 1974 with an annual production capacity of 100,000 vehicles.

The newer Karawang plant opened last year at a Rp 500 billion investment (about US$50 million) to produce passenger cars only.

It has a production capacity of 30,000 vehicles per year.

TAM, a joint venture between the widely diversified Astra International and Japan's Toyota Motor Corporation, holds more than 50 percent of the local car market.

Aminuddin declined to elaborate on the background of the strike at Kadera, or of the prospect of it being resolved.

According to him, the strike was Kadera's internal problem on which he could not comment.

Strikes have become a popular means for Indonesian laborers to press their demands.

The downfall of former president Soeharto in 1998, gave rise to an organized labor movement in Indonesia that has stung a wide variety of businesses.

Strikes at oil and gas, mining, textile and shoe companies have plagued foreign and local investors alike.

Earlier this year, several foreign investors in the footwear industry were reported to have allocated orders to neighboring countries due to Indonesia's unruly labor unions.(bkm)