JAKARTA (TheInsiderStories) - PT SGMW Motor Indonesia, a joint venture between SAIC Motor Corporation Ltd, General Motors and Guangxi Automotive Corporation held a groundbreaking ceremony on Thursday (Aug. 20) at Greenland International Industrial Center (GIIC) in Cikarang, Bekasi.
The JV company aims to produce 150,000 units of car per year, with brand name Wuling.
“The development of the plant will certainly create positive impact on Indonesia’s economy, either in the form of the creation of new jobs and tax revenues that will ultimately stimulate the national economic development,” said Director General for Metal, Machine, Transportation Equipment and Electronics at the Industry Ministry I Gusti Putu Suryawirawan said during the groundbreaking ceremony.
The car assembling plant is being developed on 60 hectares of land with total investment of US$700 million. PT SGMW Motor Indonesia will team with more than 20 component producers both from China and Indonesia. The car assembling plant is projected to absorb 3,000 new workers and begin commercial operation in 2017.
Although car sales fell in the first half of 2015, the Industry Ministry remains upbeat about the prospect of automotive industry in the years to come. Last year (2014), as many as 1.2 million cars were sold in the country and projected to rise to 2.5 million units per annum in 2020.
Putu called on the SGMW Motor board to prioritize the development of component makers to support its assembling plant as well as develop post sales network so that the automotive company can win Indonesian market. He also hopes the company can make Indonesia as an export hub for Southeast Asian market.
Later in the day, SGMW Motor held a gala dinner that was also attended by Indonesian Industry Minister Saleh Husin.
Saleh Husin said the Industry Ministry will continue to encourage automotive companies to make Indonesia as production base that will supply domestic and export market.
Saleh Husin said early in the day during the opening of Gaikindo Indonesia International Auto Show (GIIAS) in BSD, Tangerang after accompanying VP Jusuf Kalla said that automotive investment is a long-term business in nature. “They are not here for one-two years, but they have a long-term business orientation,” he said.
The presence of SGMW in Indonesia will certainly challenge the Japanese automakers that have already dominated the automotive industry in Indonesia such as Toyoto, Daihatsu and Mitsubishi brands. It remains to be seen whether SGMW’s car brand “Wuling” will be able to penetrate Indonesian market. (*)
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