Timor says it has no plan to cut prices of its sedans
Timor says it has no plan to cut prices of its sedans
JAKARTA (JP): PT Timor Distributor Nasional, distributor of
the country's much disputed Timor car, said yesterday that the
rupiah's sharp depreciation against the U.S. dollar and Kia
Motor's financial problem would not affect its car prices.
Timor Distribution's president Soemitro Soerachmad said
neither the sharp appreciation of the U.S. dollar against the
rupiah, nor South Korean Kia's financial problems would make the
company lower the price of its S-515 and S-515i models.
Soemitro denied recent rumors the company would cut the price
of Timor.
The rumor was based on a recent 30 percent discount of Kia
Motor's Credos, Pride and Sephia cars (which are called Timor in
Indonesia).
PT Timor Distribution is the sales division of PT Timor Putra
Nasional, which was granted exclusive rights last year to
manufacture the so-called "national car".
The company, controlled by President Soeharto's youngest son
Hutomo Mandala Putra, is allowed to import assembled Sephia --
renamed Timor -- from Kia Motors Corp of South Korea., until its
manufacturing facilities are fully built.
The national car receives import duty and luxury tax
exemptions, making it more than 60 percent cheaper than other
cars in the domestic market.
Soemitro said that Timor had nothing to do with Kia's sales
campaign last July, because about 39,000 Timor cars had been
shipped to Indonesia. "So we would not need to import any more,"
he said.
He said Timor would also not cut its car price because Timor
sold its cars at manufacturing price, while Kia's cars were sold
at retail price.
The price of Timor S-515 remained at Rp 33.35 million
(US$12,851) and the Timor S-515i at Rp 35.4 million, he said.
Kia launched the big discount to get fresh funds to strengthen
its cash flow, he said.
The Kia Group, once South Korea's eighth largest conglomerate,
was recently placed under bank protection of creditors to prevent
its insolvency.
Soemitro said Timor would keep its plan to transfer
manufacturing and assembling technology from Kia.
Forty-nine Timor employees are being trained at Kia Motors
Corporation in South Korea, he said.
Timor Putra's president Hutomo said yesterday his company was
looking into the possibility of using the technology from the
Italian sports carmaker Lamborghini, in addition to Kia Motors.
Timor is currently in the process of negotiating a US$840
million loan with a bank consortium to speed up its manufacturing
plant.
The government has ordered 16 local government and private
banks, led by state-owned Bank Dagang Negara, to lend to the
project. (das)