ASEAN KEY DESTINATIONS
Indomobil taps into logistics amid slowdown in auto sales
PT Indomobil Sukses Internasional (IMAS) will continue to grow its logistics services business next year to maintain its position as a leading integrated automotive company in the country, its top official says.
Indomobil president director Jusak Kertowidjojo said the giant automotive distributor had tapped into logistics services not because of its tumbling automotive sales but rather due to the wide opportunities in the logistics sector resulting from booming e-commerce activities.
Indomobil also has extensive experience in operating and maintaining logistics transportation as the company is the sole distributor of Hino trucks.
“[We are entering this sector] first because we have been a major player in trucks. If we have sold trucks, why not touch on logistics? We have an established network and the sector has things to do with how to maintain and operate trucks,” Jusak told reporters on Tuesday after opening the stock trade at the Indonesia Stock Exchange (IDX) celebrating the company’s 22nd anniversary at the bourse.
The group started tapping into the sector in September by partnering with Japanese logistics company Seino Holdings (SHD) to set up joint ventures PT Seino Indomobil Logistics and PT Seino Indomobil Logistics Services, which specialize in logistics and IT support as well as logistics consulting, respectively.
Seino Indomobil Logistics has a capital of US$36 million with 70 percent shares owned by Indomobil and 30 percent by SHD. Seino Indomobil Logistics Services, meanwhile, has capital of $4 million with 51 percent of its shares owned by Indomobil and the remaining 49 percent by SHD.
Jusak said the ventures currently only served Java, delivering various items ranging from consumer goods to construction materials. They are likely to expand to serve consumers or e-commerce in the future.
“Because the logistics business has just been operating for a month, it has not contributed much to our revenue but eventually it will increase,” he said.
Indomobil, the biggest automotive distributor besides Astra International, saw a 5 percent decrease in revenue as of September to Rp 13.5 trillion ($985 million) from Rp 14.2 trillion in the same period last year after a decrease in automotive sales.
Cars sales, although falling, still contributed the most to the revenue, followed by spare parts sales and revenue earned by the company’s subsidiary Indomobil Finance, according to Jusak.
The firm also saw a total comprehensive loss of Rp 206 billion, a decrease from a Rp 258 billion net loss as of September 2014 amid the slowdown in the automotive industry. In September 2013, the company saw total comprehensive income of Rp 635 billion.
Jusak predicted the outlook would remain the same until year-end at least. He, however, declined to mention the company’s sales target for next year.
“I personally still believe in Indonesia’s economic fundamentals, as it has a huge population and emerging middle-income group, although the local and global economy in the near future is very difficult for us to predict,” he said.
The automotive industry in the country is seeing the lowest sales in the last four years, with monthly purchases mostly below 90,000 units, from around 100,000 vehicles per month in the last few years. ( - See more at: http://www.thejakartapost.com/news/2015/11/18/indomobil-taps-logistics-amid-slowdown-auto-sales.html#sthash.2z1IsgpS.dpuf
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