US Auto giant to invest US$1.4bn in Indonesia

An automotive manufacturer from United States is in talks with Indonesia government to invest an integrated car production facilities in the country with investment up to USD1.4bn, the largest automotive investment committment so far.


Detik.com quoted Muhammad Lutfi, head of Investment Coordinating Agency, saying the US company would produce cars in the range of 1,000 cc to 2,000 cc cyllinders with installed capacity up to 200,000 units per year.
Lutfi didn't disclose the name of the company but admitting Indonesia and Thailand are now competing to bring in the investment. Thailand is considered a better place for investment for automotive giants mainly due to its more relax luxury cars tax system.
But Indonesia is a big market with strong demand. Last year, the car sales reached its record high of 530,000 units.
Indonesia is not a place of choice for US auto manufacturers as none of Ford or General Motors made significant investment here. Japanese car manufacturers are the dominant players in the market with Toyota, Suzuki, Honda, and Mitsubishi as the leading brands.

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