Timor car set to penetrate Malaysian mart

Timor car set to penetrate Malaysian mart

JAKARTA (JP): PT Timor Putra Nasional signed an agreement with
a Malaysian car distributor yesterday to sell its Timor cars in
Malaysia, with both parties hopeful that they can compete against
the highly popular and locally produced Proton Wira.

Under the agreement with Triumph Rotary Sdn Bhd, Timor Putra
will initially export 300 of its S515i sedans.

The Malaysian distributor hopes to order 4,200 vehicles in the
first year and 6,000 vehicles in the second year of the
agreement.

The agreement was signed by president of PT Timor Distributor
Nasional Soemitro Soerachmad and managing director and chief
executive of the Malaysian company Marvin C.S. Yong.

"We see a great opportunity for Timor in Malaysia. The
decision to export was made after long consideration," Soemitro
said.

He denied the suggestion that Timor's poor sales in Indonesia
had forced his company to look to foreign markets.

Timor Putra Nasional, a newcomer in the Indonesian car
industry, has the sole permit to build the "national car", a
facility that entails it various tax breaks.

The company is controlled by President Soeharto's youngest son
Hutomo "Tommy" Mandala Putra.

Currently, Timor cars are produced by KIA Motors Corps of
South Korea, prompting protest from Japan, the United States and
Europe.

Triumph Rotary has reportedly invested Rp 15 billion (US$5.08
million) as initial investment to develop Timor sales offices in
the country, which will be opened in October. The company has
more than 10 years of experience as a car distributor and has 50
outlets and 20 service centers throughout Malaysia.

Yong said he was confident of Timor's prospects because
Malaysia had a big market for sedans, accounting for 80 percent
of total car sales.

Timor would be priced competitively to enable it to compete
against Proton Wira, the Malaysian national car.

Foreign cars in Malaysia are subject to 164 import duty and
other taxes.

Yong said his company had chosen Timor Putra and not Kia "in
ASEAN spirit".

PT Timor Distributor Nasional claims it has had more than 25
percent of the sedan market since October last year although
sales have not been as high as expected.

With all the tax breaks, the Timor cars outpriced other sedans
in the same category in Indonesia by nearly 50 percent.

The company had expected to sell more than 3,000 cars a month
but sales have been much less. In February, only about 950 Timors
were sold, a drop from 3,260 in January.

Soemitro said Timor Putra had sold 21,000 cars so far and
blamed the government's tight monetary policy for the laggard
sales. (08)