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NEWS UPDATES Asean Affairs                      13  August 2011

GM, Peugeot to revive Indo plants

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General Motors and Peugeot plan to revive their assembly plants in Indonesia, following moves by other car makers that are using the nation as a base for exporting to the region.

GM said on Friday that it will invest $150 million to reactivate the Bekasi plant in West Java to build a “people mover” van for Southeast Asia. The biggest US automaker will begin production of the vehicle in 2013 and build 40,000 of the vans a year, ultimately creating more than 800 jobs.

GM, which said it will add new manufacturing equipment at the plant, didn’t disclose further details about the vehicle, including name, design specifications or pricing.

Astra International, the sole local distributor of the French car brand and also the country’s largest automaker, plans to revive the Peugeot assembly line, which was mothballed in 2005.

Constantinus Herlijoso, chief executive of Astra International-Peugeot — the joint venture between the two companies — said it would start carrying out production testing in the first quarter of 2012 at the old assembly facility in Sunter, Jakarta. The size of the investment was still under consideration, he said.

“If the test goes well, we will start producing completely knocked down cars in Gaya Motor’s factory by the end of 2012,” and that factory would have production capacity of 1,000 units per year, Constantinus said.

Peugeot’s announcement was welcomed by Industry Minister M.S. Hidayat, who said the company had spoken to the government about its intentions.

Hidayat said that Peugeot wanted to expand after a recent improvements to sales in Indonesia fueled by the country’s rising middle class.

“They must expand in order to compete with Japanese manufacturers,” he said. “Competition is tight because other companies are also expanding.”

Constantinus said the joint venture planned to replace old equipment at the factory, allowing it to produce new models including the Peugeot 3008 and 5008. At present, Peugeot imports those models, as well as the older 207 and 308 models, from Malaysia and France.

“If we can build the cars here, we can push down prices for our cars by up to 20 percent. This will boost our competitiveness,” Constantinus said.

GM and Peugeot joins Chrysler, Daihatsu, Suzuki, BMW, Tata Motor and Nissan Motor in eyeing the archipelago as a production base.

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This year in Thailand-what next?

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It is commonplace in journalism to write two types of articles at the transition point between the year that has passed and the New Year. As this writer qualifies as an “old hand” in observing Thailand with a track record dating back 14 years, it is time take a shot at what may unfold in Thailand in 2011.

The first issue that can’t be answered is the health of Thailand’s beloved King Bhumibol, who is now 83 years old. He is the world's longest reigning monarch, but elaborate birthday celebrations in December failed to mask concern over his health. More


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