Automotive Industry Indonesia: New Player Arrives from China
Chinese car manufacturers seem not afraid to compete with their Japanese counterparts on Indonesian soil. After Wuling Motors arrived in Indonesia in mid-2017, now another Chinese car-maker, Sokonindo Automobile, has started operations in Indonesia, Southeast Asia's largest car market.
For many decades Japanese cars have been dominating car sales in Indonesia and this situation is unlikely to change drastically in the years ahead. Various Western car brands tried to compete with their Japanese counterparts on this market but failed, and therefore some have shut their factories.
Read more: Why Do Japanese Cars Dominate Indonesia's Automotive Market?
Chinese car manufacturers, on the other hand, still have the spirit and are expanding to Indonesia. Sokonindo Automobile is the latest example. This company is a joint venture between Hong Kong's Sokon Group Company Limited and Indonesia's Kaisar Motorindo Industri. The joint venture has already invested USD $150 million in the construction of a car factory. Besides supplying the domestic market of Indonesia, part of output will be exported abroad, particularly to other Southeast Asian nations. As such, Indonesia has become the company's production hub for this region.
Alexander Barus, Chief Executive Officer (CEO) at Sokonindo Automobile, said - considering being a newcomer in Indonesia - the company will first focus on the quality of the vehicles. The vehicles will be of international standard. However, they also need to be competitively priced to be attractive for the Indonesian consumer. Sokonindo Automobile will manufacture the sport utility vehicle (SUV), multipurpose vehicle (MPV) as well as light commercial vehicles at its Indonesian plant.
Currently, Sokonindo Automobile has 30 dealers in Indonesia. However, the company targets to expand this network to 150 dealers in the next three years.
Indonesian Industry Minister Airlangga Hartarto is pleased to see Sokonindo Automobile establishing its production base in Indonesia. Their manufacturing plant is another positive step in the development of Indonesia's automotive industry.
Indonesian Car Sales (CBU):
| Month | Sold Cars 2013 |
Sold Cars 2014 |
Sold Cars 2015 |
Sold Cars 2016 |
Sold Cars 2017 |
| January | 96,718 | 103,609 | 94,194 | 85,002 | 86,324 |
| February | 103,278 | 111,824 | 88,740 | 88,208 | 95,159 |
| March | 95,996 | 113,067 | 99,410 | 94,092 | 102,336 |
| April | 102,257 | 106,124 | 81,600 | 84,770 | 89,623 |
| May | 99,697 | 96,872 | 79,375 | 88,567 | 94,091 |
| June | 104,268 | 110,614 | 82,172 | 91,488 | 66,370 |
| July | 112,178 | 91,334 | 55,615 | 61,891 | 84,905 |
| August | 77,964 | 96,652 | 90,537 | 96,282 | 96,466 |
| September | 115,974 | 102,572 | 93,038 | 92,541 | 87,645 |
| October | 112,039 | 105,222 | 88,408 | 92,106 | 94,461 |
| November | 111,841 | 91,327 | 86,938 | 100,365 | |
| December | 97,706 | 78,802 | 73,264 | 86,547 | |
| Total | 1,229,916 |
1,208,019 | 1,013,291 | 1,061,859 |
Source: Gaikindo