Toyota raises car prices in response to rupiah's fall

Toyota raises car prices in response to rupiah's fall

JAKARTA (JP): PT Toyota-Astra Motor (TAM), one of the biggest
car producers in Indonesia, raised car prices by between Rp 1
million (around US$350.85) and Rp 7 million as an adjustment to
the sharp drop in rupiah against the U.S. dollar.

The company said the price of its popular Kijang vans were
increased by between Rp 1 million and Rp 2.5 million while those
for sedans were increased by between Rp 2 million and Rp 7
million.

The company said car prices should be adjusted to the increase
in the dollar against the rupiah because most car components were
purchased with dollars.

But the company said the price increases were made as small as
possible so that it would not burden buyers.

The rupiah has declined by over 20 percent against the U.S.
dollar since early January, most of which took place in the last
few weeks due to speculative attacks from local and foreign fund
managers.

Founded in 1971, Toyota-Astra Motor is 51 percent owned by
publicly listed PT Astra International, Indonesia's biggest
carmaker, and 49 percent by Japan's Toyota Motor Corporation.

Its products include Toyota Crown, Corona, Corolla and Starlet
sedans, Kijang and Dyna vans as well as Land Cruiser jeeps.

The Kijang, the most popular vehicle in Indonesia, was first
produced in the early 1970s. The company increased the new Kijang
production to 7,800 vehicles in June to cope with the growing
demand.

Dandy Pawiatan, an executive of PT Toyota Astra Motor, said
the off-the-road prices (not including taxes) of the long
flatdeck pick-up Kijang were increased by Rp 1 million to Rp 24.8
million from Rp 23.8 million, while the off-the-road prices for
the pick-up Kijang of the flatdeck diesel model were increased to
Rp 29.1 million from Rp 28.1 million.

The price increase for the Kijang van of SX and LX types was
Rp 1.5 million.

Dandy Pawitan said the price increase of the sedan car was
between Rp 2 million to Rp 7 million per vehicle.

He said the off-the road price of Toyota Land Cruisers, for
example, was increased by Rp 7 million to Rp 187.7 million from
Rp 180.7 million and Crown to Rp 188.6 million from Rp 181.6
million.

He said the price increase for the Starlet sedan was only Rp 2
million to Rp 50.1 million from Rp 48.1 million, Toyota Corolla
Rp 3 million to Rp 70.3 million from Rp 68.3 million and Corona
Rp 3 million to Rp 94.6 million from Rp 91.6 million.

Other cars

Several other automotive companies said earlier they would
also raise car prices to meet the growing production cost as the
result of the U.S. dollar's sharp increase against the rupiah.

Herman Z. Latief, an executive of the country's second largest
auto producer PT Krama Yudha Tiga Berlian, said his company would
definitely raise prices. But he declined to say how much.

PT Timor Putra Nasional, producer of the national "Timor" car,
has also indicated it would raise the prices of Timor sedans if
the dollar continues to strengthen against the rupiah.

"Whether we want to or not, if the dollar continues to
strengthen we will have to adjust the Timor car price," Timor
Putra president Hutomo Mandala Putra said last Sunday.

But he said the weakening rupiah would not inhibit the
construction of his company's manufacturing facilities in
Cikampek, West Java.

Timor Putra has been allowed to import Sephia sedans from
South Korea's Kia Motors Corp. under the brand name "Timor" until
the company's assembly plant is set up in 1999.

It is currently one of the cheapest sedans on the Indonesia
market due to exclusive tax and tariff exemptions granted by the
government, which allow Timor Putra to sell its cars at nearly 60
percent less than comparable models.

The company announced last week that it was expecting to
receive a loan of US$690 million from a consortium of state and
private banks to help Timor Putra build its plant in West Java,
though the loan has yet to be signed. (08/aly/rid)