Gearing Toward

I n d o n e s i a n A u t o m o t i v e 1

Gearing Toward the Future

I n d o n e s i a n A u t o m o t i v e2

“ Indonesian Autoparts: Gearing Toward the Future”Is developed as part of national efforts to create mutual beneficial economic cooperation and partnership between Indonesia and world communities.

Published in 2011 by :Trade Policy Analysis and Development AgencyMinistry of Trade, Republic of Indonesia

Handbook of Commodity Profile

Cetakan Pertama

I n d o n e s i a n A u t o m o t i v e i

I n d o n e s i a n A u t o m o t i v eii

I n t r o d u c t i o n

As part of our continuous effort to support development of national trade policy, The Trade Policy

Research and Development Agency is making effort to collect, assess, and present trade and industry

information in an innovative and comprehensible form. And here we present you the profile of auto-

motive parts industry of Indonesia.

With more than 241 million people and a healthily growing economy, Indonesia is an important

market for any automotive brands, but it is also fast becoming an important part of their production

strategy. The major brands are partnering with local companies and entrepreneurs to design and man-

ufacture components and assemble cars and motorcycles in Indonesia for the huge domestic market

and the promising export market.

Readers of this book would appreciate its illuminating contents as well as its beautiful design, com-

bining technical specifications and statistics with easily readable narrative and supporting pictures.

We hope that the readers will find this book informative and enjoyable.

Herry Soetanto

Head of Trade Policy Analysis and Development Agency (TRECYDA)

I n d o n e s i a n A u t o m o t i v e iii

M e s s a g e

Minister of Trade Republic of Indonesia

Mari Elka Pangestu

Situated between two large continents and two vast oceans, blessed with fertile soil and gracious

climate, and populated by one of the most astounding biodiversity in the planet, Indonesia has been

famous as supplier of natural resources for the global market. But Indonesia is also a rapidly industri-

alizing nation. And one of the most important industry in the country is automotive parts industry.

After their first encounter with motor vehicles more than a century ago, enterprising and highly-

skilled Indonesians are developing an industry to cater to the needs of the notable automotive indus-

try in the country and abroad. By making the most of Indonesia’s strategic location, vast natural re-

sources, huge domestic market, skilled labor force, and supportive Government policies, Indonesian

businesses are now entering the global market for automotive components.

In the foreseeable future, the automotive parts industry will grow in importance to become the

source of prosperity and pride for the people of Indonesia.

I n d o n e s i a n A u t o m o t i v eiv

C O N T E N T S

INTRODUCTION

MESSAGE

AUTOMOTIvE INDUSTRy IN INDONESIA: A CENTURy Of PROGRESS

Indonesia had its first encounter with motor vehicles in 1893, but automotive manufacturing industry didn’t begin to boom until the 1970s. As the need for auto-motive parts grew, so did Indonesia’s own automotive parts industry

INDONESIAN AUTOMOTIvE PARTS INDUSTRy : MANUfACTURING PARTS fOR ThE GlObAl AUTOMOTIvE INDUSTRy

The Indonesian automotive parts market is strongly supported by the huge domestic market. Domestic market demand has historically been the driver for the rise and growth of Indo-nesia’s assembling and component industries. The strong demand for automotive parts from the ever-growing automo-tive market in Indonesia has created an ever growing industry particularly for aftersales markets.

INDUSTRIAl CENTERS fOR DEvElOPMENT AND MANUfACTURING Of AUTOMOTIvE PARTS

As with many industries, automotive parts industry in Indonesia is also or-ganized around certain geographical areas. These areas are typically highly industrialized areas with easy access to infrastructure and energy and/or cluster areas where similar industry has traditionally grown, which makes it easy for new firms to start business. Or, areas where the automotive parts industry’s largest client, the automotive industry itself, is located nearby.

1

6

13

I n d o n e s i a n A u t o m o t i v e v

36

GOvERNMENT POlICIES: REINfORCING AND bOOSTING ThE INDUSTRy

The Indonesian automotive industry has a number of weaknesses which affect its competitiveness. This fact has not escape Government attention. Policies are formulated to address the issues. An examination of the Indonesian national industry policy shows that the Indone-sian automotive parts industry is considered as one of the prioritized industry for development.

INDONESIAN AUTOMOTIvE PARTS IN WORlD TRADE

USA, Japan, Germany, France and Italy have long been the leader in the automotive industry—they have advanced design and manufacturing capabilities as well as the most well-known brands in the world. South Korea, China, India, and Brazil have now joined their rank. Indonesia stands at number 31 on the list of exporters, but it has grown in value at a healthy 9% p.a. between 2006-2010, a strong growth among the top exporters.

lIST Of CONTACTS

17

20

Ministry of Trade Indonesian Trade Attaches Indonesian Trade Promotion Centers Companies

I n d o n e s i a n A u t o m o t i v evi

I n d o n e s i a n A u t o m o t i v e vii

A CENTURY OF PROGRESSAutomotive Industry in Indonesia :

Indonesia had its first encounter with motor vehicles in 1893, but

automotive manufacturing industry didn’t begin to boom until the

1970s. As the need for automotive parts grew, so did Indonesia’s own

automotive parts industry.

Roughly 9 years after Karl Benz made the first practical automobile, it has spread across

the world and entered Indonesia. Indonesia, which at that time was still under Dutch Colonial

rule, had its first sight of the automobile in 1894. The Sultan of the Javanese kingdom of Solo

became the first person in Indonesia to own a car, a Benz car which he specifically ordered

from Germany. A year before that, in 1893, an Englishman working as a machinist in a sugar

refinery in the Indonesian town of Probolinggo, became the owner of the first motorcycle in

Indonesia, after receiving his order of a motorcycle from its producer in Muenchen, Germany.

1893 AnEnglishmanworkinginasugarrefineryinProbolinggobecametheownerofthefirstmotorcyclein Indonesia,producedinMuenchen,Germany1894 Indonesianhaditsfirstsightoftheautomobile,theSultanofSurakartabecamethefirstpersoninIndonesia toownacar,aBenzfromGermany1904 TheRegentofBrebeshadhisfirstcar1913 TheSultanofTernateorderedoneofthefirstcarsinthecountry1938 ThefirstautomobiledealershipownedbyanativeIndonesianwasopened:RPSoenaryoGondokoesoemo ofYogyakartasoldGeneralMotors’cars1950s SuccessfulbusinessmanHasjimNingstarteddealershipandIndonesia’sfirstautomotiveassembling….1960s-1980s ….followedbyotherlegendaryfiguresinIndonesianautomotiveindustry:WilliamSuryadjaya,Syarnoebi SaidandSoebrontoLaras1950s-1960s Japaneseautomakersmaketheirentry1970s Newgovernmentregulationrequiresthatimportedcarsbeimportedinknockeddownformfortheassembling processinIndonesia1976 Newregulationwasenactedwhichrequiredtheuseoflocallyproducedautomotivecomponentsintheas semblingprocess1980s Japanesebrandsbegantodominatethemarket1996 ------PresidentialInstructionNo.2/1996establishapolicyforanationalcarindustry

I n d o n e s i a n A u t o m o t i v eviii

The automobile business in Indonesia then developed slowly. By 1938, the first automo-

bile dealership owned by anative Indonesian was opened. RP Soenaryo Gondokoesoemo,

opened the first dealership in Indonesia in the city of Jogyakarta, dealing in General Motors

cars. Successively, the early motor vehicle dealerships were started by pioneering Indonesian

businessmen Hasjim Ning (1950s), then followed by William Suryadjaya, Syarnoebi Said and

Soebronto Laras during the 1960s, 1970s, and 1980s respectively. Automotive business in this

early period were dominated by US manufacturers, most particularly General Motors, with its

Chevrolet brand. Japanese auto manufacturers did not make their entry until the 1950s-1960s,

which then began to dominate the Indonesian automotive market starting in the 1980s.

During the early time (early 1900s-1960s), motor vehicles are in use exclusively only by

the very rich members of Indonesian nobility, wealthy businessmen or members of the rul-

ing Dutch Colonial society (before the independence). Motor vehicles during the time before

Indonesia’s independence all the way up to the late 1970s were expensive and owned by

very few Indonesian due to their prohibitively high prices and the relatively low incomes of

Indonesians back then. Historical records for example, take note only of the very rich owning

motor vehicles. Take for example the Sultan of Ternate who ordered one of the first cars in the

country in 1913, and the Regent of Brebes who had his first car in 1904.

The Birth of a National IndustryThe Indonesian automotive parts industry closely follows the development of automotive

industry in Indonesia. During the first 90 years of motor vehicle existence in history, Indone-

sians simply imported everything needed for the vehicles. Dealers import whole vehicles and

the needed spare parts to keep the cars running. There were no assembling process/knocked

down vehicles and certainly also no automotive component industry. As a result, the already

expensive prices of motor vehicles, coupled with high taxes and also expensive all-imported

spare parts, made motor vehicle ownership accessible only to very few people in Indonesia.

It was not until the latter half of the 1970s that the Indonesian automotive component

industry started to take form. During the 1970s, new government regulation requires that

imported cars be imported in knocked down form, for assembling in Indonesia. This opens up

an entirely new industry in Indonesia: automotive assembling. In addition, in 1976, a new regu-

lation was also enacted which required the use of locally produced automotive components

in the assembling process. This in effect stimulated the birth of the Indonesian automotive

component industry.

By the early 1990s, the Indonesian government further attempted to stimulate the growth

of Indonesian automotive industry and its supporting component industry by enacting regu-

I n d o n e s i a n A u t o m o t i v e ix

lations which award tax reduction on automotive imports based upon the amount of locally

produced components which they utilized. Products with more local components content

were awarded lower taxes, which in turn translated to lower selling prices, which eventually

made products with local contents more competitive in the still-price-conscious Indonesian

market of the time.

In the latter half of the 1990s, the Indonesian government even attempted to create a full-

fledged national automotive industry. In 1996, then President Suharto’s government enacted

the Presidential Instruction No. 2/1996, which stipulated the national automotive industry.

This Presidential decree stipulated that to be considered for a national automotive industry

status, an automotive manufacturer had to have the following: a brand created by itself, be

100% owned by Indonesians, and be able to fulfill local content of 20% in its first year of op-

eration, 40% in its second year, up to a minimum of 60% in its third year. In turn, Government

Regulations were enacted in support of the Presidential Instruction. The Ministry of Finance

exempted taxes on imported components on these “national automotive industry” vehicles.

The Timor Putra Nasional was then selected as a pioneering company in the national automo-

tive industry project.

The Asian financial crisis of 1997 however, wiped out the Indonesian dream of a national

automotive industry. With the downfall of the Suharto government, the national automotive

industry project came to a halt, and eventually dissolved. By 1999, in response to a number of

Parts manufacturing

companies, like the one

in East Java shown here,

has been supplying vari-

ous items to well-known

global brands

I n d o n e s i a n A u t o m o t i v ex

international trade treaties such as APEC, AICO and AFTA, Indonesia deregulated and started

allowing the importation of completely built-up vehicles. Even so, with the drastic deprecia-

tion in the value of the Indonesian currency since the crisis, knocked down, assembled vehicles

with local component contents remained highly competitive as these are much less affected

by the currency fluctuations.

As can be predicted, the Indonesian automotive parts industry in turn, followed closely

these developments. As the need of automotive components grew, so did Indonesia’s own

automotive component industry. The Indonesian automotive components grew to serve the

need of its parent automotive industry. The Indonesian automotive components industry at

first served the need to assemble automobile with local component contents in the late 1970s.

It grew along as the Indonesian automotive market grew and as more and more people own

motor vehicles. Today, the Indonesian automotive industry and its automotive component in-

dustry serve a growing market. The Indonesian automobile industry’s sales were 764,710 new

cars and 7,398,644 motorcycles in 2010. Such a large domestic market certainly requires large

supply of automotive parts. Today Indonesian companies have grown in almost every aspect

of the automotive industry. It employs more than 300,000 workers, and is the third largest tax-

paying industry in the country, contributing more than US$ 9 billion in tax revenues in 2010.

The following is the total domestic sales of Indonesian automotive industry, which shows

tremendous growth:

Year Sales

1996 332,035 1997 386,691 1998 58,303 1999 93,843 2000 300,964 2001 299,634 2002 317,780 2003 354,208 2004 483,148 2005 533,917 2006 318,904 2007 607,151 2008 434,313 2009 483,548 2010 764,710

Year Sales

1996 1,376,647 1997 1,801,090 1998 433,551 1999 487,751 2000 864,144 2001 1,575,822 2002 2,265,474 2003 2,809,896 2004 3,898,744 2005 5,074,186 2006 4,428,274 2007 4,688,263 2008 6,215,831 2009 5,881,777 2010 7,398,644

Indonesian Car Sales Indonesian Motorcycle Sales

I n d o n e s i a n A u t o m o t i v e xiI n d o n e s i a n A u t o m o t i v e xi

Parts of vehicle’s braking system. The core components are

made of asbestos and the frame is made from steel

I n d o n e s i a n A u t o m o t i v exii

MANUFACTURING PARTSFOR THE GLOBAL

AUTOMOTIVE INDUSTRY

The Indonesian automotive parts market is strongly supported by

the huge domestic market. Domestic market demand has historically

been the driver for the rise and growth of Indonesia’s assembling and

component industries. The strong demand for automotive parts from

the ever-growing automotive market in Indonesia has created an ever

growing industry particularly for after sales markets.

Indonesian Automotive Parts Industry :

Components manufactured by

Indonesia is not just for cars and

motorbikes. Shown here is a

dashboard for a road grader.

I n d o n e s i a n A u t o m o t i v e xiii

Markets, Industry Structure and Value ChainThe motorcycle market in particular, has been one of the main driver of growth of this

market, as evidenced by the massive, double digit growth (more than 12% for the period of

2005-2010) of the Indonesian motorcycle sales as shown in the table below.

SALES GROWTHYear Production Wholesales Exports WHOLE SALE (WHOLE SALE + EXPORTS + EXPORTS)

1996 1,425,373 1,376,647 50,255 1,426,902

1997 1,861,111 1,801,090 51,816 1,852,906 29.86%

1998 519,404 433,551 84,363 517,914 -72.05%

1999 571,953 487,751 99,651 587,402 13.42%

2000 98,238 864,144 115,278 979,422 66.74%

2001 1,644,133 1,575,822 74,948 1,650,770 68.55%

2002 2,318,241 2,265,474 52,517 2,317,991 40.42%

2003 2,814,054 2,809,896 13,806 2,823,702 21.82%

2004 3,897,250 3,898,744 1,774 3,900,518 38.13%

2005 5,113,487 5,074,186 15,308 5,089,494 30.48%

2006 4,458,886 4,428,274 42,448 4,470,722 -12.16%

2007 4,722,521 4,688,263 25,632 4,713,895 5.44%

2008 6,264,265 6,215,831 64,968 6,280,799 33.24%

2009 5,884,021 5,881,777 29,815 5,911,592 -5.88%

2010 7,395,390 7,398,644 29,395 7,428,039 25.65%

Average Growth 2005-2010 12.80%

Source: AISI (Asosiasi Industri Sepedamotor Indonesia), Association of Indonesian Motorcycle Industry

In addition, the Indonesian car industry has also seen some phenomenal growth in recent

years, with growth averaging almost 17% for the years of 2005-2010.

Car Sales in Indonesia

A component for heavy equip-

ment (cup engine).

Year Sales Growth

1996 332,035

1997 386,691 16.46%

1998 58,303 -84.92%

1999 93,843 60.96%

2000 300,964 220.71%

2001 299,634 -0.44%

2002 317,780 6.06%

2003 354,208 11.46%

2004 483,148 36.40%

2005 533,917 10.51%

2006 318,904 -40.27%

2007 607,151 90.39%

2008 434,313 -28.47%

2009 483,548 11.34%

2010 764,710 58.15%

Average Growth 16.94%

2005-2010Source: Statistics Indonesia (bPS)

Motorcycle Sales in Indonesiaper Unit

I n d o n e s i a n A u t o m o t i v exiv

The table below shows the growth of the number of motor vehicles in Indonesia, which

also shows double digit growth of more than 18% for the period of 2005-2010.

1987 1,170,103 303,378 953,694 5,554,305 7,981,480

1988 1,073,106 385,731 892,651 5,419,531 7,771,019 -2.64%

1989 1,182,253 434,903 952,391 5,722,291 8,291,838 6.70%

1990 1,313,210 468,550 1,024,296 6,082,966 8,889,022 7.20%

1991 1,494,607 504,720 1,087,940 6,494,871 9,582,138 7.80%

1992 1,590,750 539,943 1,126,262 6,941,000 10,197,955 6.43%

1993 1,700,454 568,490 1,160,539 7,355,114 10,784,597 5.75%

1994 1,890,340 651,608 1,251,986 8,134,903 11,928,837 10.61%

1995 2,107,299 688,525 1,336,177 9,076,831 13,208,832 10.73%

1996 2,409,088 595,419 1,434,783 10,090,805 14,530,095 10.00%

1997 2,639,523 611,402 1,548,397 11,735,797 16,535,119 13.80%

1998 2,769,375 626,680 1,586,721 12,628,991 17,611,767 6.51%

1999 2,897,803 644,667 1,628,531 13,053,148 18,224,149 3.48%

2000 3,038,913 666,280 1,707,134 13,563,017 18,975,344 4.12%

2001 3,261,807 687,770 1,759,547 15,492,148 21,201,272 11.73%

2002 3,403,433 714,222 1,865,398 17,002,140 22,985,193 8.41%

2003 3,885,228 798,079 2,047,022 19,976,376 26,706,705 16.19%

2004 4,464,281 933,199 2,315,779 23,055,834 30,769,093 15.21%

2005 5,494,034 1,184,918 2,920,828 28,556,498 38,156,278 24.01%

2006 6,615,104 1,511,129 3,541,800 33,413,222 45,081,255 18.15%

2007 8,864,961 2,103,423 4,845,937 41,955,128 57,769,449 28.15%

2008 9,859,926 2,583,170 5,146,674 47,683,681 65,273,451 12.99%

2009 10,364,125 2,729,572 5,187,740 52,433,132 70,714,569 8.34%

Average Growth 18.33%

2005-2010

Year Passenger Cars Buses Trucks Motorcycles Total Growth

Source: badan Pusat Statistik (bPS)/Statistics Indonesia, quoting from Indonesian National Police data

The rapidly growing Indonesian automotive market, which by today’s latest official data

amount to more than 70 million passenger cars, buses, trucks and motorcycles (approximately

more than 80 million by 2010 as per latest sales data as mentioned), provides a solid base for

the Indonesian automotive component industry to take part in providing various supporting

roles. Productive, efficient and quality parts supplier for assembling and replacement/mainte-

nance purposes, with guaranteed quality, competitive pricing and timely delivery, are in high

demand by the Indonesian automotive industry and consumers. Today, more and more sup-

pliers of automotive components and spare parts have scrambled to meet the needs of the

domestic market alone. What’s more, due to the domination of Indonesia’s automotive market

by foreign auto manufacturers, these same automotive components and spare parts suppliers

are demanded to be able to meet the exacting requirements for these spare parts if they were

Growth of the Indonesian Automotive Industry

I n d o n e s i a n A u t o m o t i v e xv

to be able to provide their products for these foreign automotive makers. These facts have led

to more and more suppliers of quality automotive components growing in Indonesia.

The Indonesian automotive component market is primarily made up of two main arenas:

1. Original Equipment Manufacturer (OEM) market, which refers to components market

for automotive components made specifically for automotive assembling market both

domestic and foreign owned.

2. Replacement Equipment Manufacturer (REM) market, which refers to manufacturers

of components for the purpose of maintenance and replacement for both domestic,

foreign and export automotive components markets.

Furthermore, the automotive components manufactured by Indonesian manufacturers,

can be categorized into six major categories:

1. Engine components

2. Electrical components

3. Transmission components

4. Suspension components

5. Chassis components

6. Car body parts

OEM players dominate the market for the assembling and replacement parts for foreign

branded cars and motorcycles (genuine parts market). They typically dominate and concen-

trate in fast moving parts, which include:

1. Engine electrical systems (batteries, battery cables, wiring harnesses, starters and

automotive lighting)

2. Engine systems (air/oil filters, fuel gaskets/valves and pistons)

3. Cooling systems (Air Conditioning systems, coolants, and door glass regulators)

4. Bodies and frames (chassis, door frames, door locks, and door glass regulators)

5. Plastic products (injection molding, boxes, interior, and automotive plastic glasses)

6. Suspension systems (shock breakers, front forks and dampers)

7. Varous plastic, rubber and stamped steel products (mechanical lifts, wrenches, steer-

ing knuckles, and under brackets)

These OEMs are typically regarded as first-tier suppliers as they are the official supplier to

the various foreign automotive manufacturers operating in Indonesia. Their products are re-

garded as “genuine” branded products. OEM suppliers are usually joint venture firms (i.e. for-

eign manufacturer partnering with local suppliers to provide parts for foreign manufacturer’s

brand) or foreign direct investment firms (firms entirely financed and acting as subsidiary of

a foreign manufacturer). These first tier suppliers operate with processes and technologies

I n d o n e s i a n A u t o m o t i v exvi

which enable them to become certified quality-cost-delivery (QCD) partners of the foreign auto-

motive brands. These firms also typically focus on the manufacture of components for first-tier

assembling markets (cars and motorcycles), sold with renown OEM brands. These first-tier sup-

pliers also sell their genuine products directly to consumers through genuine parts distributor/

certified first tier wholesalers, and even in aftersales markets through various subsidiaries.

These first-tier manufacturers however, rarely work alone in manufacturing their products.

Some of their production capacity is outsourced to second tier certified QCD manufacturers

which, typically, further specialize in certain products. These second tier manufacturers differ

from first tier manufacturers in their capacity and capability. They typically exist to supplement

and meet the demands of the first tier manufacturer’s manufacturing capability. In addition

to catering to the demands of first-tier manufacturers however, some of these second-tier

manufacturers have also evolved to develop their own brands of automotive components.

In addition to first- and second-tier manufacturers, the Indonesian automotive compo-

nent market is also served by a third category, the third-tier manufacturers. Third-tier manu-

facturers assist second-tier manufacturers to meet their production demands. In addition,

third-tier manufacturers also market their products to aftermarket sellers, providing what In-

donesians term as “KW” class of components. These are not genuine products but are rather

good enough to serve as replacement parts. Third-tier manufacturers are typically small and

medium sized enterprises.

By the arrangement of these layers, first and second tier manufacturers typically distribute

their products of OEM and QCD certified automotive components through the network of

Agen Tunggal Pemegang Merek (ATPM/sole licensed agent of automotive brand) authorized

workshops and dealerships. Second and third tier manufacturers on the other hand, market

their “lower quality” products also through aftermarket distribution channels, through small

retailers or lesser known workshops. In addition, first, second and third tier manufacturers dif-

fer in their capability in performing the various aspects of automotive component engineering

and production processes.

First tier/OEM automotive component firms are highly capable in their production mas-

tery. First tier manufacturers are capable to perform egineering development, tooling and fab-

rication, production engineering, production, all the way to sufficient quality control activities.

On the other hand, second and third tier manufacturers due to the nature of their business

of mainly being suppliers of first tier manufacturers, concentrate on certain aspects. Typically

they concentrate on production while leaving quality control, engineering development and

tooling and fabrication development to first tier manufacturers or simply outsourced some of

these functions.

I n d o n e s i a n A u t o m o t i v e xvii

Major PlayersAs mentioned, Indonesian automotive component industry can be categorized into a

number of layers, consisting of first (OEM), second and third layers. First layer consist of highly

qualified and connected manufacturers which manufacture automotive components to the

specification and Quality-Cost-Delivery requirements of major automotive brands. Second

layer manufacturers on the other hand serve first layer manufacturers, while also marketing

their products through aftermarket channels. Third layer manufacturers exist for and provide

support to second layer manufacturers by supplying specialized component products.

As per its nature, the first tier manufacturers are the closest to principal brands. As of

today, there are a number of internationally recognized, automotive brands operating in In-

donesia, these are:

Automobiles (Country of Origin):

1. B M W (Germany)

2. Chery (China)

3. Chevrolet (United States of America)

4. Chrysler (United States of America)

5. Daewoo (South Korea)

6. Daihatsu (Japan)

7. Ferarri (Italy)

8. Fiat (Italy)

9. Ford (United States of America)

10. Geely (China)

11. Hino (Japan)

12. Honda (Japan)

13. Hyundai (South Korea)

Motorcycles (Country of Origin):

1. Bajaj (India)

2. Honda (Japan)

3. Kanzen (Indonesia)

4. Kawasaki (Japan)

5. Suzuki (Japan)

6. TVS (India)

7. Vespa (Italy)

8. Viar (Indonesia)

9. Yamaha (Japan)

14. Isuzu (Japan)

15. KIA (South Korea)

16. Lamborghini (Italy)

17. Mercedez Benz (Germany)

18. Mitsubishi (Japan)

19. Nissan (Japan)

20. Opel (Germany)

21. Peugeot (France)

22. Porsche (Germany)

23. Proton (Malaysia)

24. Suzuki (Japan)

25. Toyota (Japan)

26. Volkswagen (Germany)

27. Volvo (Sweden)

Muffler, for exhaust pipe of a four-

wheeled vehicle, made of stainless

steel plate

I n d o n e s i a n A u t o m o t i v exviii

I n d o n e s i a n A u t o m o t i v e xix

INDUSTRIAL CENTERS FOR DEVELOPMENT

AND MANUFACTURING OF AUTOMOTIVE PARTS

As with many industries, automotive parts industry in Indonesia is also

organized around certain geographical areas. These areas are typically

highly industrialized areas with easy access to infrastructure and ener-

gy and/or cluster areas where similar industry has traditionally grown,

which makes it easy for new firms to start business. Or, areas where the

automotive parts industry’s largest client, the automotive industry itself,

is located nearby.

The Indonesian motorcycle market have grown tremendously fast.

To respond to this trend, global companies have setup factories in

Indonesia (opposite page). Indonesian companies are capable of

supplying as much as 70% of the parts needed by producing them

domestically, may it be chassis (right), body (above), accessories,

electrical instrument or any other parts.

I n d o n e s i a n A u t o m o t i v exx

As for export purposes, the following provinces are the top 10 automotive parts exporting

provinces in Indonesia along with their export values for the period of:

These numbers however do not necessarily reflect actual production numbers as most of

these figures rely on shipping ports of origin. As for the actual production centers, below are

some of the largest areas of automotive component production centers.

Jakarta and Its Surrounding AreaJakarta is the country’s capital and is also one of its most important industrial centers. The

availability of a busy international port of Tanjung Priok, which makes import and exports

much easier and also grants easy access to markets not only in Indonesia but also overseas,

and the relatively good infrastructure of the area attracts many industries to settle in this

region. Jakarta’s various industrial centers most notably in the Pulogadung and West Jakarta

areas house large number of automotive component manufacturers. The nearby City and Re-

gency of Bekasi houses one of the most important industrial centers in the country. Industrial

estates line the highways which ultimately lead to the city of Jakarta and the rest of the nation.

Bekasi area industrial centers are home to large number of automotive manufacturers, par-

ticularly assembly plants, and automotive component manufacturer and suppliers.

West Java and BantenWest Java is a province immediately surrounding the Jakarta area. As mentioned, the Beka-

si Regency is one of the country’s leading industrial centers. Heavy industries are concentrated

here due to its good infrastructure of highways and rail and close proximity to Jakarta. Bekasi

Regency also routinely attracts large number of investment in automotive industry and auto-

motive component industry. Karawang, a Regency neighboring Bekasi to its West, is also an

important industrial center, particularly in the assembling of vehicles and manufacturing of

automotive components.

NO. PROVINCE EXPORT VALUE 2010 (US$)

1 D K I JAKARTA 2,393,584,047

2 EAST JAvA 366,354,937

3 RIAU ISlANDS 133,145,161

4 EAST NUSA TENGGARA 1,992,563

5 EAST KAlIMANTAN 1,778,310

6 NORTh SUMATERA 1,486,210

7 CENTRAl JAvA 944,747

8 b A l I 452,236

9 bANTEN 113,300

10 R I A U 58,314

Source: Statistics of Indonesia / bPS

10 Exporting Provinces of Automotive Parts

I n d o n e s i a n A u t o m o t i v e xxi

Tangerang, located in a newly created Province of Banten just west of Jakarta is also an

important industrial center for automotive component and automotive assembling and man-

ufacturing. As can be seen from the distribution, industrial parks of automotive industry tend

to cluster around Jakarta and its surrounding provinces.

East JavaEast Java’s Province capital is Surabaya. Surabaya is one of the country’s largest cities and

also house one of its ports. In addition, East Java also houses large number of automotive

component industrial centers located in the cities of Malang, Pasuruan, Surabaya and Sidoarjo

areas.

Central Java and YogyakartaCentral Java is a center of Indonesian small and medium sized business in the automotive

component industry. The cities of Tegal and Pati are some of the hotbeds of small-medium

sized automotive component makers. Tegal in particular is known as the city of workshops

and the automotive spare parts (lower tiered) capital of Indonesia. This city of approximately

250,000 inhabitants got it start as spare parts manufacturing center due to the large number

of metal-smith industries in the city. Over time, some of these evolved into the more lucrative

business of automotive component manufacturers.

Another important part of the Central Java automotive component industry is the city of

Magelang near Yogyakarta which is famous for its “Karoseri” industry—industry which makes

vehicle bodies (mostly buses and trucks) and interiors. Yogyakarta, on the other hand, a prov-

ince to the south of Central Java city of Magelang, is also an industrial center, and owing to

large numbers of universities and higher learning educational institutions, is one of the na-

tion’s supplier of highly trained human resources.

I n d o n e s i a n A u t o m o t i v exxii I n d o n e s i a n A u t o m o t i v exxii

I n d o n e s i a n A u t o m o t i v e xxiii

REINFORCING AND BOOSTING

THE INDUSTRY

Government policies :

The Indonesian automotive industry has a number of weak-

nesses which affect its competitiveness. This fact has not escape

Government attention. Policies are formulated to address the is-

sues. An examination of the Indonesian national industry policy

shows that the Indonesian automotive parts industry is consid-

ered as one of the prioritized industry for development.

The Indonesian automotive industry has a number of weaknesses which affect its com-

petitiveness, most importantly of which is dependence on imported raw materials and certain

industrial products for the manufacture of automotive components. This dependence puts

Indonesia’s automotive component at the mercy of foreign raw materials suppliers and auto-

motive component-related industrial materials manufacturers.

In order to address the weaknesses of the Indonesian automotive industry, the most recent

direct policy concerning the Indonesian automotive component industry is in enacting tax

incentives for the import of raw materials and goods needed for the manufacture of automo-

tive component, as stipulated in Regulation of the Minister of Finance No. 107/PMK.011/2011

concerning Government-Exempted Tariffs on the Import of Goods and Materials for the Man-

ufacture of Motor Vehicle Components Fiscal Year 2011 (latest regulation signed on July 18

2011). This Regulation of the Minister of Finance states 148 HS code posts of goods and raw

materials whose tariffs are exempted for import purposes, in support of the Indonesian au-

I n d o n e s i a n A u t o m o t i v e xxiii

I n d o n e s i a n A u t o m o t i v exxiv

tomotive component industry. The tariff exemption of these goods and raw materials means

that Indonesian automotive component industry can import these goods and raw materials

tariff-free for the purpose of automotive component manufacture, which in turn can bolster

their competitiveness and export capability. These tax incentives amount to approximately

US$ 60 million of savings for the Indonesian automotive component industry in 2011 alone.

Other tax incentives for the Indonesian automotive component industry include lower value

added taxes/luxury goods taxes for vehicles made and assembled in Indonesia.

Another role of the government in support of the Indonesian automotive component in-

dustry is in creating a number of government sanctioned projects which will utilize to the

fullest the potential of the Indonesian automotive component industry. The most recent of

these projects is the planned Indonesian low-cost and green car initiative by the Indonesian

Ministry of Industry and other related agencies and ministries. The low-cost green car initiative

demands for the development of at least two class of cars which can be produced at low cost

while also environmentally friendly and highly fuel efficient, while at the same time utilizing

local industry capacity and capability to the maximum. These two class of vehicles (minimum)

are planned to include:

1. A 1000cc class car, with fuel consumption of 1 liter gasoline per 22 kilometers

2. A 1200cc class car with fuel consumption of 1 liter gasoline per 20 kilometers

Indonesian Government

provides various facilities

that can be used by local

entrepreneurs and compa-

nies to develop their product

and technology, such as

laboratory and material test-

ing instruments.

I n d o n e s i a n A u t o m o t i v e xxv

Other planned conditions for car manufacturers to fulfill the low-cost green car project’s

specifications include minimum utilization of locally produced automotive component of 60%,

and retail price of approximately US$ 7,500.

As of the writing of this booklet, the Indonesian government is in the process of construct-

ing the necessary regulatory framework for the development of the low-cost green car project.

Three Japanese automotive manufacturers, however, has expressed interest and has show-

cased their concept vehicles respectively at the 2011 Indonesian International Motor Show.

One of the manufacturers at least has started ground breaking for a new manufacturing plant

which would accommodate the said vehicles’ production.

A broader examination of the Indonesian national industry policy shows that the In-

donesian automotive parts industry is considered as one of the prioritized industry for

development. It is considered as one of the priority industries for achieving above 7%

economic growth of the country. As such, it is achieving quite a large share of Indonesian

government’s attention, as evidenced by the multitude of tariffs it is supported by. The

government is also working closely with industry associations in the automotive and au-

tomotive component manufacturing industries to help it formulate policies which would

further assist the industry as a whole, and to help it compete in the increasingly competi-

tive global marketplace.

List of Related RegulationsBelow are some of the regulations related to the Indonesian automotive component in-

dustry:

1. Regulation of the President of The Republic Indonesia No. 28 Year 2008 Concerning

National Industrial Policy

2. Regulation of the Minister of Finance No. 107/PMK.011/2011 concerning Govern-

ment-Exempted Tariffs on the Import of Goods and Materials for the Manufacture of

Motor Vehicle Components Fiscal Year 2011

3. Regulation of the Director General of Industry, Transportation Equipment and Tele-

communications and Informatics No. 15/IATT/PER/03/2009 concerning The Proce-

dure of Authorization Stamping and the Allocation of Government-exempted Im-

port Tariff on the Importation of Goods and Materials for the Manufacture of Motor

Vehicle Components, Manufacture of Electronic Components, Manufacture of Fiber

Optic Cables and/or Telecommunications Equipment and the Manufacture and/or

Maintenance of Ships.

I n d o n e s i a n A u t o m o t i v exxvi

INDONESIAN AUTOMOTIVE PARTS

Agriculture machinery is one of the

applications of automotive technology

in Indonesia

I n d o n e s i a n A u t o m o t i v e xxvii

IN WORLD TRADE

USA, Japan, Germany, France and Italy have long been the leader in the au-

tomotive industry—they have advanced design and manufacturing capabilities

as well as the most well-known brands in the world. South Korea, China, India,

and Brazil have now joined their rank. Indonesia stands at number 31 on the list

of exporters, but it has grown in value at a healthy 9% p.a. between 2006-2010,

a strong growth among the top exporters.

I n d o n e s i a n A u t o m o t i v e xxvii

I n d o n e s i a n A u t o m o t i v exxviii

Primary Export ProductsIn the automotive sector, Indonesia is still a net importer. In the following table we can see

export and trade balance on each of the category of HS 87 in 2010, sorted from the highest

export value.

Code Product label Exported value Trade balance 2010 2010

8708 Parts & access of motor vehicles 1,175,099 (843,952)

8703 Cars (incl. station wagon) 1,026,906 (809,627)

8714 Parts and accessories of motorcycles & cycles 215,240 (348,185)

8712 bicycles & other cycles, not motorized 160,067 118,188

8704 Trucks, motor vehicles for the transport of goods 73,856 (2,420,624)

8711 Motorcycles, side-cars 58,987 (12,112)

8716 Trailers&semi-trailers;other vehicles not mechanically propelled 6,600 (42,381)

8705 Specl purp motor vehicles (fire fight veh,crane lorry) 2,888 (46,517)

8713 Invalid carriages (wheelchairs), w/n motorized 2,687 892

8701 Tractors (other than tractors of heading no 87.09) 2,246 (88,694)

8709 Work truck,self-propeled, for factories/airport & parts 1,263 (4,834)

8710 Tanks and other armored fighting veh, motorized, and parts 1,006 (61,466)

8702 Public-transport type passenger motor vehicles 747 (69,047)

8707 bodies for motor vehicles 252 (12,410)

8715 baby carriages and parts thereof 190 (4,705)

8706 Chassis fitted with engine for motor vehicles 81 (3,643)

Total 2,728,115 (4,649,117)

(In US$ thousand)

Source: ITC/Trademap, 2011

Some items have enjoyed millions of dollar worth of exports. The following table will show

the Top 5 export products with more than US$ 1,000,000 in export values produced by Indo-

nesian automotive parts manufacturers, sorted by the latest data year of 2010.

Indonesian Export of Automotive Components with Value Above US$ 1 million

1 8708402300 Gearboxes,assembled 208,516,719 202,566,948 266,110,704 242,076,018 318,486,897 forvehicleofhd87.03

2 8703221990 Othmotorcars,1,000-1500cc,notckd 87,413,450 212,040,186 320,425,813 214,306,017 314,101,177 internalcombustrecipropistonengine

3 8714190040 Othpart&acces,formotorcyclesof 2,837,478 91,630,784 154,859,219 140,232,005 176,251,885 subheading,8711.10,8711.20/8711.90

4 8703235491 Othmotorcar,2500-3000cc,(4x2)system75,268,935 97,436,383 125,695,889 102,860,775 165,132,372 ,notckd,intcombustrecipropistengine

5 8708701300 Wheelcentredisc&capfor 73,982,429 134,794,118 153,672,625 131,036,836 162,419,253 othvehicleofheading87.03

NO HS CODE DESCRIPTION EXPORT VALUE : US$ 2006 2007 2008 2009 2010


Indonesian Export and Trade Balance in 2010hS 87: vehicle Other Than Railway and Tramway

I n d o n e s i a n A u t o m o t i v e xxix

The following table shows main trade indicators for each of the 4-digit level sub-categories

of HS 87. Between 2009-2010, overall growth in value is 50%, a remarkable feat.

HS Productlabel Exported Trade Annualgrowth Sharein Rankingin value2010 balance2010 world worldexports (USDthousand) (USDthousand) exports(%)

TOTAL--HS87 2,728,115 (4,649,117) 9 3 50 0.3 31

8701 Tractors(otherthantractorsof 2,246 (88,694) -14 -3 -38 0 64 headingno87.09)8702 Public-transporttypepassenger 747 (69,047) 52 46 -32 0 79 motorvehicles8703 Cars(incl.stationwagon) 1,026,906 (809,627) 19 10 63 0.2 308704 Trucks,motorvehiclesforthe 73,856 (2,420,624) 16 2 50 0.1 42 transportofgoods8705 Speclpurpmotorvehicles 2,888 (46,517) 2 -27 -20 0 59 (firefightveh,cranelorry)8706 Chassifittedwithenginefor 81 (3,643) -24 -20 35 0 57 motorvehicles8707 Bodiesformotorvehicles 252 (12,410) -34 -32 -51 0 658708 Parts&accessofmotor 1,175,099 (843,952) 4 2 39 0.4 29 vehicles8709 Worktruck,self-propeled,for 1,263 (4,834) 15 -7 -87 0.1 39 factorie/airport&parts8710 Tanksandotherarmouredfighting 1,006 (61,466) 145 90 0 17 veh,motorised,andparts8711 Motorcycles,side-cars 58,987 (12,112) 18 14 33 0.4 198712 Bicycles&othercycles, 160,067 118,188 33 8 77 2.1 8 notmotorised8713 Invalidcarriages(wheelchairs), 2,687 892 -11 -32 -24 0.2 24 w/nmotorised8714 Partsandaccessoriesof 215,240 (348,185) -6 -9 60 1.5 13 motorcycles&cycles8715 Babycarriagesandpartsthereof 190 (4,705) -1 -19 -21 0 438716 Trailers&semi-trailers;other 6,600 (42,381) -13 -12 54 0 59 vehiclesnotmechanicallypropelled

Invalue Inquantity Invalue 2006-2010 2006-2010 2009-2010 (%,p.a.) (%,p.a.) (%,p.a.)


Trade Indicators of Products Exported by IndonesiahS 87: vehicles other than railway, tramway

I n d o n e s i a n A u t o m o t i v exxx

Manufacturing of cylinder

liner in East Java. The

product is sold to Europe

and USA

Country of Destinationfor Indonesian Export of Automotive Components

hS 87: vehicle other than railway, tramway

Importers Exported Trade value 2010 Balance 2010

1 Thailand 488,871 (1,552,664)

2 Japan 379,008 (2,932,825)

3 Saudi Arabia 254,137 254,135

4 Malaysia 251,977 110,360

5 Philippines 245,002 203,499

6 Singapore 152,433 (52,380)

7 belgium 94,056 91,873

8 brazil 79,971 36,843

9 South Africa 64,480 62,121

10 United States of America 63,925 (69,989)

11 viet Nam 57,050 41,156

12 United Arab Emirates 53,080 53,058

13 Mexico 45,269 36,793

14 Chinese Taipei 44,144 (30,919)

15 China 38,824 (329,645)

16 United Kingdom 38,393 (41,078)

17 India 26,545 (209,684)

18 Germany 22,486 (200,374)

19 Pakistan 20,595 20,118

20 Oman 20,254 20,253

Other Countries 287,615

Total World Import 2,728,115 (4,649,117)


Export DestinationsIn terms of destination, Indonesia exported to a number of countries. Although still a net

importer, the main source of imports is developed economies like Japan and Germany—coun-

tries that are the global leaders in this industry. But in relations to other developing countries,

Indonesia has a strong position.

in US$ Thousand

I n d o n e s i a n A u t o m o t i v e xxxi

I n d o n e s i a n A u t o m o t i v exxxii


No. HS Components 20101 8712009000 Othercycles 385,0822 8711204100 Motorcycles,scooters,withreciprointcombustpistonengine,50-125cc,notckd 24,8573 8708999900 Otherparts,accesforothervehiclesofheading87.02,8704,8705 8,5854 8703905100 Othermotorcar,<=1800cc,notckd 5,5005 8708809000 Partsofsuspensionsystems(inclshock-absorbers) 4,7296 8703234390 Othermotorcars,2000-2500cc,ckdinternalcombustrecipropistonengine 4,6957 8716809000 Othvehicles,notmechanicallypropelled 4,6508 8703221990 Othmotorcars,1,000-1500cc,notckdinternalcombustrecipropistonengine 3,8859 8708801400 Suspensionsystemsforvehicleofsebhd8704.10/heading87.05 3,15010 8708409000 Partsofgearboxes 2,252

Automotive component exports from the province of Bali 2010Component selected from the 10 largest, in US$

Province of Origin of Indonesian ExportAs previously mentioned, Jakarta and its surrounding districts is the most important cen-

ter for automotive and automotive parts industry. Foreign automotive companies and their

local partners setup factories and offices here because Jakarta is Indonesia’s biggest market,

the area has excellent infrastructure and facilities (including ports, roads and many industrial

estates), and access to other main markets are easy. In 2010, export of HS 87 from Jakarta was

more than US$ 2 billion. East Java comes next with more than US$ 366 million.

No. HS Components 20101 8708402300 Gearboxes,assembledforvehicleofhd87.03 318,486,8972 8703221990 Othmotorcars,1,000-1500cc,notckdinternalcombustrecipropistonengine 314,097,2923 8714190040 Othpart&acces,formotorcyclesofsubheading,8711.10,8711.20/8711.90 176,192,7434 8703235491 Othmotorcar,2500-3000cc,(4x2)system,notckd,intcombustrecipropistengine 165,132,3725 8703235190 Othermotorcars,1500-1800cc,notckdinternalcombustrecipropistonengine 151,193,7896 8708999900 Otherparts,accesforothervehiclesofheading87.02,8704,8705 124,628,3267 8703229000 Othervehicles,1,000-1500cc,notckdinternalcombustrecipropistonengine 112,087,2838 8708502300 Drive-axleswithdifferential,assabledforvehiclesofheading87.03 80,025,6809 8703235492 Othmotorcar,2500-3000cc,(4x4)system,notckd,intcombustrecipropistengine 75,298,35210 8704312900 Othervans,<=5t,notckd,internalcombustionpistonengine 57,194,12711 8703235291 Othmotorcar,1800-2000cc,(4x2)system,notckd,intcombustrecipropistengine 56,963,04412 8708911300 Radiatorsforvehiclesofheading87.03 55,061,80713 8703245092 Othmotorcars,>3000cc,(4x4)system,notckd,intcombustrecipropistengine 46,607,92614 8708299300 Othpart,accessofbodiesforagricul.ofheading8703 41,985,68815 8703325900 Othermotorcars,1500-2000cc,notckd,diesel 37,320,260


Automotive Component Exports from Jakarta in 2010Selected Top 15 Items, in US$

I n d o n e s i a n A u t o m o t i v e xxxiii

Automotive component exports from the province of Central Java, 2010


Component selected from the 15 largest, in US$

No. HS Components 20101 8705909000 Otherspecialpurposemotorvehicles 419,5202 8701101900 Pedestriancontrolledtractors,power<=22.5kwoththanforagriculturaluse 172,1033 8701101100 Pedestriancontrolledtractors,power<=22.5kwforagriculturaluse 130,0594 8703312000 Othermotorcars,<=1500cc,notckd,diesel 61,5735 8712002000 Bicyclesdesignedtoberiddenbychildren 34,8046 8714190040 Othpart&acces,formotorcyclesofsubheading,8711.10,8711.20/8711.90 30,8217 8712003000 Otherbicycles 25,9288 8701901100 Agriculturetractorsofacylindercap<=1100cc 13,9849 8711109100 Motorcycle,inclmoped,scooters,reciprointcombustpistonengine<50cc,notckd 11,31910 8712009000 Othercycles 11,13711 8711202200 Motorcycles,scooters,withreciprointcombustpistonengine,125-150cc,ckd 7,59212 8703324990 Othermotorcars,2000-2500cc,ckd,diesel 6,85013 8703235392 Othmotorcar,2000-2500cc,(4x4)system,notckd,intcombustrecipropistengine 6,50014 8708292000 Partsofsafetyseatbeltsofheading8701-8705 3,99715 8711109900 Othermotorcycles,reciprointpistonengine<50cc,notckd 2,860

Automotive component exports from the province of East Java, 2010Component selected from the 20 largest, in US$

No. HS Components 20101 8708701300 Wheelcentredisc&capforothvehicleofheading87.03 141,246,3162 8712009000 Othercycles 137,686,0843 8708701900 Wheelcentredisc&capforothvehicleofheading8702&8704(exlc8704.10) 29,698,5354 8708709300 Otherroadwheelforvehiclesofhead87.03 18,495,5775 8708302000 Brakes,servo-brakes;partsthereofforvehiclesofheading87.03 11,686,1806 8712001000 Racingbicycles 5,056,5297 8704211900 Othervans,<=5t,ckd,diesel 4,232,1648 8708959000 Partsofsafetyairbagswithinflatersystem 2,672,3869 8714190090 Othpart&acces,formotorcyclesofsubheading,8711.30,8711.40/8711.50 2,218,89310 8708309000 Brakes,servo-brakes;partsthereofforvehiclesofheading8702;8704;8705 2,147,80211 8704212900 Othervans,<=5t,notckd,diesel 1,404,10512 8708929000 Silencers(mufflers),exhaustpipe;partsforvhclofhd8702,8704(exlc8704.10) 1,106,32313 8703109000 Vehiclesspeciallydesignedfortravelonsnowandsimilarvehicles 1,028,53614 8704102200 Damperdesignedforoffhighway,>24tnotckd 970,03915 8711202100 Motorcycles,scooters,withreciprointcombustpistonengine,50-125cc,ckd 676,85516 8711203000 Othermotorcycles,reciprointpistonengine,50-250cc,ckd 641,17417 8711202200 Motorcycles,scooters,withreciprointcombustpistonengine,125-150cc,ckd 411,16018 8711204300 Motorcycles,scooters,withreciprointcombustpistonengine,150-200cc,notckd 339,61719 8711204100 Motorcycles,scooters,withreciprointcombustpistonengine,50-125cc,notckd 332,85520 8714999000 Parts&accessoriesofvehicleofhead87.11to87.13.(exlc.8712.00.20) 297,012


I n d o n e s i a n A u t o m o t i v exxxiv

Automotive component exports from the province of Riau Island, 2010


Component selected from the 15 largest, in US$

No. HS Components 20101 8714999000 Parts&accessoriesofvehicleofhead87.11to87.13.(exlc.8712.00.20) 107,500,5442 8714991000 Parts&accessoriesofbicycleofsubhd8712.00.20 19,674,3733 8716400000 Othertrailersandsemi-trailers 4,160,4154 8708999900 Otherparts,accesforothervehiclesofheading87.02,8704,8705 915,5575 8716399000 Othertrailersandsemi-trailersforthetransportofgoods 403,6096 8711401090 Motocrossmotorcycles,withreciprointcombustpistengine,500-800cc,notckd 166,4917 8708109000 Bumper&partsforvehiclesheading8702;8703;8704;8705 81,9118 8708401900 Gearboxes,unassembledforvehiclesofhead8701-8702&8704(exlc8704.10) 44,7719 8701101900 Pedestriancontrolledtractors,power<=22.5kwoththanforagriculturaluse 40,52810 8708991900 Unassembledfueltank;enginebracketforvehiclesofhead87.02;87.04;8705 39,43411 8704211900 Othervans,<=5t,ckd,diesel 32,00012 8701102900 Pedestriancontrolledtractors,power>22.5kwoththanforagriculturaluse 20,26413 8716809000 Othvehicles,notmechanicallypropelled 17,94714 8709110000 Electricalvehicles 10,25615 8710000000 Tanks,otherarmouredfightingvehicles,motorised,withweapons/not,&parts 5,908

Most of the industrial centers are located in the Island of Java, the most industrialized

among all the regions of Indonesia and the one with the largest population. The Province of

Riau Islands managed to export more than other, larger provinces because it is located next

to Singapore. Industrial estates in Riau Islands, especially in Batam Island, are export-oriented.

Others exporting provinces include: East Nusa Tenggara (US$ 1,992,563), East Kalimantan

(US$ 1,778,310), and North Sumatera (US$ 1,486,210).

I n d o n e s i a n A u t o m o t i v e xxxv

Muffler, a part of a vehicle exhaust

system, are produced in numerous

areas of Central Java.


Volume of Exports of Automotive Components, 2006-2010in Kilogram

2006 2007 2008 2009 2010

45.000.000

40.000.000

25.000.000

10.000.000

35.000.000

20.000.000

5.000.000

30.000.000

15.000.000

0

270.977.060

336.699.751

419.923.471

270.510.147

373.840.257

Growth in ExportFor the period of 2006-2010, export of automotive parts (HS 87) is increasing. The value

and volume peaked in 2008 and dropped in 2009. The recession in the West might have a role

in this, but export has picked up steam again and increased in 2010 to the amount nearing

2008.


Value of Exports of Automotive Components, 2006-2010

2006 2007 2008 2009 2010

25.000.000

10.000.000

35.000.000

20.000.000

5.000.000

30.000.000

15.000.000

0

1.666.150.032

2.195.981.689

2.970.576.385

1.957.755.532

2.899.934.661

in US$

Realization of exports of Indonesian automotive components to The WorldhS 87: vehicle other than railway, tramway

I n d o n e s i a n A u t o m o t i v exxxviI n d o n e s i a n A u t o m o t i v exxxvi

This motorcycle spare part is made by

metal casting technique by home indus-

tries. Many are sold in the after-sales

market.

I n d o n e s i a n A u t o m o t i v e xxxviiI n d o n e s i a n A u t o m o t i v e xxxvii

I n d o n e s i a n A u t o m o t i v exxxviiiI n d o n e s i a n A u t o m o t i v exxxviii

cylinder liner (houses the piston in the engine

combustion chamber) one of the important

components in the machine

I n d o n e s i a n A u t o m o t i v e xxxix

Ministry of TradeRepublic of Indonesia

JI. M.I. Ridwan Rais No.5 Main Building, Jakarta 10110 INDONESIA Phone. [62-21] 385 8171 (hunting) Fax. [62-21] 235 28691

E-mail. [email protected]

I n d o n e s i a n A u t o m o t i v e xxxix

Directorate General of International Trade

Cooperation

JI. M.I. Ridwan Rais No. 5 Main Building, 8th Floor,

Jakarta 10110 - INDONESIA

Phone : (62-21) 23528684, 3858171 Pes. 36900

Fax : (62-21) 23528610

E-mail : [email protected]

Directorate General of National Export Development

JI. M.I. Rldwan Rais No.5 Main Building, 4th Floor, Jakarta

10110 - INDONESIA

Phone : (62-21) 23527240

Fax : (62-21) 23527250


Commodity Future Trading Regulatory Agency

(COFTRA)

Ministry of Trade Building, 4th Floor.

Jl. Kramat Raya No. 172 Jakarta Pusat 10430

Phone : (021) 31922389

Fax : (021) 31922421

E-mail. [email protected]

Website www.bappebti.go.ld

Trade Policy Analysis and Development Agency

(TRECYDA)

JI. M.I. Ridwan Rais No. 5 Main Building

4th Floor, Jakarta 10110 - INDONESIA

Phone : (62-21)2352 8680, 3858171 Pes. 39900

Fax : (62-21) 23528690


Secretariat General JI. M.I. Ridwan Rais No.5 Main Building I, 7th Floor Jakarta Pusat 10110 - INDONESIAPhone : (62-21) 23528440, 3858171 Ext. 32040Fax : (62-21) [email protected]

Inspectorate General

Ministry of Trade Building, 6 th Floor,

Jl. Kramat Raya No. 172 Jakarta 10430

Phone : (021) 31906436, (021) 3100569 Ext. 602

Fax : (021) [email protected]

Directorate General of Domestic Trade Jl. M.I. Ridwan Rais No.5, Main Building, 8th Floor Jakarta 10110 - INDONESIA Phone : (62-21) 23528520, 3858183, 3858171 Ext. 34120, 34900Fax : (62-21) 3857338E-mail : [email protected]

Directorate General of Foreign Trade JI. M.I. Ridwan Rals No. 5 Main Buildin, 9th Floor Jakarta 10110 - INDONESIA Phone : (62-21) 23528560, 3858171 Pes. 35900Fax : (62-21) 23528570E-mail : [email protected]

I n d o n e s i a n A u t o m o t i v exl

INDONESIAN TRADE ATTAChES

Washington DC, United States of AmericaIndonesianEmbassy,2020Massachusettsavenue.N.WPhone:(202)7755350Fax :(202)77553574Email : [email protected] :www.inatrade-use.org

Riyadh, Saudi ArabiaIndonesianEmbassy,RiyadhDiplomaticQuarter,POBOX94343Riyadh11693Phone:(966-1)4882800,4882030ext120Fax :(966-1)4882966Email : [email protected]

Den Haag, NetherlandsIndonesianEmbassy8,TobiasAsserlaanPhone:(31-70)-3108115Fax : (31-70)-3643331Email : [email protected]

Brussel, BelgiumIndonesianMissiontotheEuropeanUnionBoulevarddelaWoluwe38,B-1200brusselsBelgiumPhone:(322)-7790915Fax :(322)-7728190Email : [email protected]

Beijing, ChinaIndonesianembassyDongzhimenwaiDajieno.4ChaoyangDistrictBeijing100600Phone : (86-10)65324748Fax : (86-10)65325368Email : [email protected]

Copenhagen, DenmarkIndonesianEmbassyOrehojAlle1,2900HellerupPhone : (45)39624422Fax : (45)39624483Email : [email protected]

New Delhi, IndiaIndonesianEmbassy50AChanakyapuriPhone : (009111)26118642-46Fax : (009111)26885460Email : [email protected]

London, United Kingdom IndonesianEmbassy,38,GrosvenorSquare,London,Phone : (44-20)72909620,7499-7661,Fax : (44-20)7495-70Email : [email protected]

Rome, Italy IndonesianEmbassyViaCampania,53 - 55 , 00187 RomePhone : (39-06)4200911Fax : (39-06)4880280Email : [email protected]

Tokyo, Japan IndonesianEmbassy,5-2-9,HigashiGotandaShinagawa-kuPhone : (81-3)34414201Fax : (81-3)34471697Email : [email protected] : indonesian_embassy.or.jp

Berlin, Germany IndonesianEmbassyLehrterStrasse16-17D-10557BerlinPhone : (4930)47807200Fax : (4930)47807209Email : [email protected]

Ottawa, Canada IndonesianEmbassy55ParkdaleavenueOttawaOntarioKIY1E5Phone : (1-613)7241100-306Fax : (1-613)7247932Email : [email protected] : www.indonesian_ottawa.org

Seoul, South Korea IndonesianEmbassy55Yoido-dong,Youngdeungpo-kuseoul150-010Phone : (82-2)7835675-7ex288Fax : (82-2)7837750Email : [email protected]

Kuala Lumpur, Malaysia IndosesianEmbassyJalanTunAbdulRazakno.233Phone : (603)21448407Fax : (603)21448408Email : [email protected] : www.kbrikl.org.my

Cairo, EgyptIndonesianEmbassy13,AishaELTemoriaSt.GardenCityP.O.BOX1661CairoPhone.: (20-2)-7944698,7947200/9Fax : (20-2)-7962495Email : [email protected]

Paris, FranceIndonesianEmbassy47-49,RueCortambertPhone : (33-1)-450302760ext.418,45044872Fax : (33-1)-45045032Email : [email protected]

Manila, PhilippineIndonesianEmbassy185,SalcedoStreet,LegaspiVillage,MakatiCityPhone : (632)-8925061-68Fax : (632)-8925878,8674192Email : [email protected]

Moscow, RussiaIndonesianEmbassyApt. 76, Entr. 3, Korovy val 7Moscow 119049,RusiaPhone : (7-495)-2385281Fax : (7-495)-2385281Email : [email protected]

Singapore IndonesianEmbassy7ChatsworthRoadPhone :(65)-67375420,68395458Fax :(65)-67375037,67352027Email : [email protected]

Madrid, Spain IndonesianEmbassy65,CalledeAgastiaPhone.:(34-91)-4130294Fax:(34-91)-4157792Email : [email protected]

Geneva, SwitzerlandIndonesianMissiononTheUnitedNationsAndOtherInternationalOrganizations16,RuedeSaintJeanPhone : (0041-22)-3455733Fax : (0041-22)-3383397Email : [email protected]

Bangkok, ThailandIndonesianEmbassy600-602PitchburiRoad,RajtheviP.O.Box1318Phone :(0066-2)-2551264ex123Fax :(0066-2)-2551264,2551267Email : [email protected]

I n d o n e s i a n A u t o m o t i v e xli

INDONESIAN TRADE PROMOTION CENTER

Johannesburg, South AfricaSuite02/E4,2NDFloor,VillageWalkOfficesPo Box 2333 - Sandton 2146, RSA JohannesburgSouthAfrica(27-11)8846240(27-11)[email protected]

Chicago, United State of America70WestErieStBuilding,3rdFL.IlinoisChicago,USA(+1)3126402643(+1)[email protected]

Los Angeles, United State3457,Wilshire,Blvd,Suit101LosAngeles,Ca90010,USA(213)-3877041(213)[email protected]

Jeddah, Saudi ArabiaJeddahIntl.BusinessCenter/JIBCLt.2PO.BOX6659Jeddah21452KSA.RuwaisDistrict996--2-6711271Itpc-sau@kemendag.go.id

Sydney, AustraliaIndonesianTradePromotionCenter(ITPC)60.PittStreetLevel2ndSydney(61-2)925.28783(61-2)[email protected]

Sao Paulo, BrazilEdificioParkLaneAlamedaSantos1787ConjIII-11AndarCerqueiraCesar,SaoPauloBrazil01419.002(55-11)326.30472,32538126(55-11)[email protected]

Santiago, ChiliNuevaTajamar481,TorreSur,Oficina796,LasCondes(+562)441-0494(+562)441-0495

Budapest, HungaryBajcsyZslinszkyut12,2ndfloorNo.205Budapest1051–Hungary(36-1)3176382(36-1)[email protected]

Chennai, IndiaIspahaniCenter-2ndfloor123/124,NungambakkanHighRoad,Channai,[email protected]

Milan, ItalyViaG.Fara39,9thFloorMilan,Italy+390236598191www.itpcmilan.com

Osaka, JapanITM4-J-8,AsiaandPacificTradeCenter2-1-10NankoKita,Suminoe-kuOsaka559-0034,Japan(081-6)66155350(081-6)[email protected]

Hamburg, GermanyMultiBuroServiceGlokengisserwall1720095Hamburg–Germany(49-40)33313-280(49-40)[email protected]

Vancouver, Canada1500WestGeorgia,[email protected]

Busan, South KoreaPartOf1stFI,KoreaExpressBuilding,#1211-1,ChonyangDong,Dong-Gu,Busan,KoreaSelatan(82-51)4411708(82-51)4411629

Mexico City, MexicoJulioVerneNo.27,ColoniaPolanco,DelegaciónMiguelHidalgo,[email protected]

Lagos, Nigeria5,anifoweshestreetVictoriaIsland(234-1)4619861,[email protected]

Lyon, FranceL’European19bldEugeneDeruelle69003Lyon,[email protected]

Barcelona, SpainCalleAribau250,IstFloorBarcelona,[email protected]

Dubai, United Arab EmiratesArbiftTower4floor#403BaniyasstreetDeiraPO.Box41664,Dubai–UAE(971-4)2278544(971-4)[email protected]

CONSUlATE-GENERAlS

INDONESIAN ECONOMIC AND TRADE OffICE

United Arab EmiratesIndonesianConsulateGeneralVillaNo.1Community322/2AAlHubaidaP.O.Box73759DubaiUAET:(971-4)3985666,3985103F:(971-4)23980804

Hong Kong IndonesianGeneralConsulate127-129LeightonRoad,6-8KeswickStreetCausewayBayHongkongT:(852)-28904421-28902481F:(852)[email protected]

TaiwanIndonesianEconomicandTradeOfficetoTaipeiTwinheadBld6FNo.550RuiGoangRoadeihuDistrictTaipeiTaiwan114(886-2)-87526170(886-2)[email protected]@[email protected]://kdei-taipei.org

I n d o n e s i a n A u t o m o t i v exlii

Automotive components are made from brass

1. PT. benin Internasional Raya. Address : Ds. Mangliawan – Kec Pakis Kabupaten Malang Jawa Timur Phone. 0341 – 791622 fax. 0341 – 791612 E-mail : [email protected] Contact : Irawan

2. UD Gading Putera. Address : Jl. Sinonggo No. 35 Gadingrejo Pasuruan Phone. 0343 – 6610066,7788910 Contact : h.M. Sulchan.

3. Perusahaan Cor logam : berlin Address : Jl. Irian Jaya 71 Pasuruan Phone. 0343 – 421910 fax. 0343 – 420184 Contact : h. Abdul Madjid.

4. PT. Aneka banu Sakti. Address : Jl Raya Wonoayu No. 26 b Gempol Pasuruan 67155. Phone. 0343 – 853110, 859220 fax. 0343 – 853111 E-mail : [email protected] [email protected] www.absakti.com Contact : Erwin Rudiyanto.

5. PT. Dian batara Peerkasa Address : Jl. Raya Panjunan 9 Sukodono Sidoarjo 61258 Phone. 031-7882538 fax. 031-7884040 E-mail : [email protected] www.dianbataraperkasa.com Contact : yohanna Megawati

6. PT. Indobatt Address : Jl. Raya Surabaya-Mojokerto Km 33 (bypass) Krian. Phone. 031-8982388.8985150,89855151 fax. 031-8982389 E-mail : [email protected], www.indobatt.com Contact : Stefanus Doddy heriyanto.

7. PT. Indo Prima Gemilang Address : Jl. Gardu Induk PlN 5 Margo Mulyo Tandes Surabaya. Phone. 031- 2977777, 7491044 fax. 031-7490819,7491739 E-mail : [email protected] [email protected] Contact : Tonny Widjaja.

8. PT. Istana Tiara Address : Jl. buntaran No. 8 Surabaya Phone. 031-7496869 fax. 031-7490915 E-mail : [email protected] Contact : Taufik

9. Perusahaan Prima Karya Address : Jl. Raya Talang Gg Central 24 Talang,

Tegal. Phone/fax : 0283-444516, Contact : Ali Satori, hP: 081548050905.

10. U.D Kriya logam Address : Jl. logam No.29 Rt 12/03 Pesayangan Talang, Tegal ,tlp. 0283-443885 Contact : Irawadi, hP: 08156580528, 081802884386

11. PT. Putra bungsu. Address : Jl. K.h Umar Asnawi II No. 37 Tegal. Contact : Parwono Edi S

12. PT. Nefa Global Industri Address : Jl. Raya balamoa Kedong Jati Km 2

Tegal. Phone. 0283-6114986, e-mail : [email protected]. Contact : Dodo Anggoro, ST, hP: 08170649682

13. PT. Gemilang lestari Teknindo (PT GlT) Address; Jl. Cemara Sewu 14 Tembok luwung Adiwerna Iegal 52194, Phone/fax : 0283-3448444. E-mail : [email protected]. Contact : Asep Syaefudin

14. vanvolker Enterprise Address: Desa Patemon RT. 01 Rw. 08, Kecamatan bojongsari, Purbalingga. Contact : Agus Adi Atmaja

15. Jet Hot Auto Muffler Address: Jl. Raya Peniron 74 Desa Galuh, Purbalingga. Contact : Muhadjirin MS, hP: 0815646772 – 081327134444

list of Contacts

I n d o n e s i a n A u t o m o t i v e xliii

16. Cv Tri Sakti Address : Jl. Raya Magelang-Purworejo, Km 10 Tempuran Magelang Jawa Tengah. Phone. 293-363649, fax.0293-363369 , e-mail : [email protected]. Contact : Andi K. Widodo

17. P.T. Triangle Motorindo factory Address: Kawasan Industri bukit Semarang baru blok A5 No. 9 Kel. Jatibarang, Kecamatan Mijen, Semarang, Jawa Tengah Head Office: Jl. Danau Agung Selatan, blok O III No. 38 Sunter Jaya Jakarta Utara 14350. Phone. 021-65832202, fax 021-65832130, e-mail : [email protected]. SMS Center : 081399920038

18. PT. Trilogam Indojaya factory Address: Kawasan Industri Jababeka I Jl. Jababeka vII G blok R1-I Jababeka - Cikarang bekasi 17530 Phone : 021-8937715, 8937716, fax. 021-8937717. Email : [email protected]

19. PT. Sinar Agung Selalu Sukses brujul - Jaten - Karanganyar - Jateng - Indonesia Website: www.sass-indo.com

20. PT. Gazgaz Motor Indonesia Jl. Pb. Sudirman 34D Pasuruan fax : 0343-427555 Contact : Monica

21. Cv. Citra Perkasa Kebangkitan Jl. Irian Jaya Gg Anggrek 197 Pasuruan Phone : 0343-414386 Contact : Supiani

22. UD. Alhikam Jl. Kol. Sugiono III E NO. 20 Pasuruan Phone : 031- 5450577 Contact : Moch. Ali

23. PT. Karya Tugas Anda Jl. Raya Sukorejo Malang hP. 0818500818 Contact : Nanang S. Kurnia

24. PT. Putra Naga Mitra Perdana Jl. legundi Menganti Gresik Phone : 031-8979127

25. PT. Sentra bumi Palapa Jl. Raya legundi 1-3 Gresik Phone : 031-7915333 Contact : Taneke

26. UD. Karoseri Gajahmada Jl. Raya Kedungturi Sidoarjo Taman Phone : 031-7882531

27. PT. famiglas Jl. Dumar Industri b 28 Surabaya Phone : 031-7483263 Contact : budi Tantono 081 1329787

28. PT. Raya Jaya Jl. Menganti Jeruk 245 Surabaya Phone : 031-7532189 Contact : haryono 081 230 19204

I n d o n e s i a n A u t o m o t i v exliv I n d o n e s i a n A u t o m o t i v exliv

I n d o n e s i a n A u t o m o t i v e xlvI n d o n e s i a n A u t o m o t i v e xlv

I n d o n e s i a n A u t o m o t i v exlvi

Ministry of Trade Republic of IndonesiaJl. M.I. Ridwan Rais No. 5, Main Building 4th FloorJakarta 10110, Indonesia

Telp. : (62-21) 385 8171Fax. : (62-21) 235 28691Web : www.kemendag.go.id

doub

leP

oran

ge.c

om

Documents

Gearing Toward