The automotive industry is one of the five manufacturing sectors that are being prioritized for its development as it will become a pioneer in the implementation of the fourth industrial revolution in the country according to the Making Indonesia 4.0 roadmap. Moreover, the automotive industry has shown positive performance and has contributed significantly to national economic growth.
“In the first quarter of 2018, the transportation equipment industry grew by 6.33 percent, above economic growth. This sector is also able to contribute up to 10.27 percent of the GDP of the non-oil and gas processing industry,” said Minister of Industry Airlangga Hartarto on August 1.
He also said that the motor vehicle industry and other transportation equipment were included in the top five manufacturing sector investments in the first quarter of this year with a value of Rp3.35 trillion. In addition, the automotive industry in Indonesia has developed into a production base for multi-purpose vehicle vehicles, trucks and pickups for the domestic and Southeast Asian markets.
Based on the ministry data, the performance of the automotive industry in Indonesia has accelerated, as seen from the number of exports in the form of vehicle components which increased by 13 times, from 6.2 million pieces in 2016 to 81 million pieces in 2017. In fact, in the ASEAN market when this, demand in the form of completely knock down is increasing.
The surge also occurred in the figure of the production of four-wheeled motorized vehicles, from 1.18 million units in 2016 to 1.22 million units in 2017. This number was strengthened by the increase in exports of vehicles in the form of CBU as many as 231 thousand units in 2017 compared to 2016 of 194 thousand units. From that achievement, the government targets the number of production in 2020 will increase to 1.5 million units.
The automotive sector in Indonesia has been able to absorb quite a lot of workforce with more than 1.5 million people, which is distributed to various sectors ranging from the assembly industry, first, second and third tier component manufacturers, to official workshops, sales, service and parts.