(Insider Stories) - Germany’s car producer Volkswagen AG plans to build the new car factory in Indonesia with total investment 200 million euro in 2014. The investment expected to announce later this year.
Industry minister Mohamad Hidayat said the car maker would build the car plant in Cikampek, West Java in areas 70 hectares. Volkswagen plans to produce multi purpose vehicles in Indonesia and make Insdonesia as a basis production for regional market. He did not say how many vehicles the plant would produce.
Chief executive Volkswagen Christian Klinger deny to give any comment on the details investment. They’re local partner PT Garuda Mataram Motor will distribute the car in domestic market.
However, he said that the German-based automaker might take part in the government-backed green car program with the possible production of hybrid cars. According to Hidayat, VW will maintain its foothold in the premium segment, but also potentially expand its presence in other market segments.
Demand for premium cars also surged along with stronger consumer’s purchasing power. Sales of premium cars, which included VW’s major brand, Audi, rose by approximately 10 percent to more than 9,300 units last year, according to statistics at the Indonesian Automotive Industry Association (Gaikindo).
Audi has seen robust domestic sales in the past years. In 2011, for instance, its sales amounted to 334 units of total sales of premium cars, more than double from a year earlier, causing Indonesia to be named the fastest growing market for the VW’s high-end brand in Asia.
Garuda Mataram Motor, is a subsidiary of the nation’s major automotive group PT Indomobil Sukses Makmur (IMAS.JK). Currently, several Audi types, such as Audi A4 and Audi A6, are assembled in Indomobil’s plant in Cakung, East Jakarta, while other types are imported from Germany in the form of completely built up (CBU) units.
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