JAKARTA (TheInsiderStories) – Japan’ related company, PT Idemitsu factory Lube Techno Indonesia (ILTI) operates second lubricant plant in Cikarang, West Java, on Thursday (07/11). The projects has absorbed investment US$52 million.
Previously, ILTI had disbursed funds amounting to $18 million to establish its first factory in Karawang, Java West, which has been operating since 2015. It said, the new plant on an area of eight hectares will produce as many lubricant products 65,000 Kiloliters (Kl) per year for the needs of the automotive and industrial sectors.
The factory in Karawang produced 50,000 Kl per annum. With the new plant, total production capacity of lubricants from Idemitsu in Indonesia reached 115,000 Kl a year.
“In the midst of a slowdown in the world economy, there are still a number of investments and expansion of the industrial sector in
Indonesia” said director general at ministry of ndustry, Muhammad Khayam in an official statement today.
He continued, overall production capacity of the domestic industry is more than 900,000 Kl. He believed, the lubricant industry is capable of making a significant contribution to the economy. Its reflected in the bookkeeping of lubricant exports which touched the figure of $147.56 million in the first semester of 2019.
“With the addition of this factory, its expected to be able to produce high-innovating products, while increasing industrial growth, especially the lubricant industry and can provide real contribution to the national economy, and absorb more labor,” said Khayam.
President Director of ILTI and PT Idemitsu Lube Indonesia, Toshiki Ikeda, stated the reason build a second factory in Cikarang, because economic growth in Indonesia is quite stable. He assured that he would meet the needs of the domestic and export markets.
“Indonesia’ economy is able to grow in the midst of current conditions, so we believe our business in Indonesia will grow well. This is also the reason for increased production capacity at the factory recently,” he explained.
For now, he said, the company still concentrated in the Indonesian market, around 93 percent and the remaining will be marketed overseas. Some of the destinations for the distribution of Idemitsu lubricants include Southeast Asia, Australia and East Central and Russia.
Khayam added, in order to encourage the development of the national lubricant industry as well to create a healthy business climate, the ministry has adopted Indonesian National Standards
(SNI) lubricants compulsorily and began to be effective on Sept. 10, 2019.
“The regulation is also in the context of protecting consumers from potential negative impacts circulation of low quality lubricant products and in the context of creating competition a healthy business between the lubricants industry,” he stressed.
At present, there are 44 national lubricant producing companies with capacity installed at 2.04 million kl per year and production of around 908,360 kiloliters every year, consists of automotive lubricants at 781,189.90 kl a year and industrial lubricants 127,170.45 kl per annum.
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