REPUBLIKA.CO.ID, JAKARTA -- The decision of Ford to stop operation in Indonesia was not a signal of decline in investment interest in automotive industry in the country, the capital investment coordinating board (BKPM) said.
The Ford's decision to stop operation in the country would have no impact on investment in the automotive industry in Indonesia, BKPM chief Franky Sibarani said.
"Interest is still strong in venturing in automotive industry in the country," Franky said here on Wednesday.
He said Ford has operated only as car importer, offering after sales service, maintenance and repair.
"It has no license in automotive industry," he added.
PT Ford Motor Indonesia, an Indonesian business unit of Ford, the producer of American cars, has announced its plan to stop operation in the country before the end of this year.
Earlier on Wednesday, PT FMI said in its electronic letter that it saw no prospects of profit in its operation in the country.
The company, however, assured its customers that it would continue to facilitate supply of services and spare parts for Indonesia.
Based on data at BKPM, total investment in the country in industry producing transport equipment including automotive industry was valued at Rp23.57 trillion in 2015, up 6.5 percent from the previous year.
Foreign investments in the automotive sector both in manufacturing and services (trade and repairs) were valued at Rp21.6 trillion in 2015, up 13 percent from the year before .
Meanwhile, Chinese automotive company, Wuling, is building a car factory with a total investment of US$397.4 million to be completed in 2017.
Franky said 15 automotive component producers would cooperate with Wuling, which would produce cars the type of multipurpose vehicles (MPV).
Wuling will have a production capacity of 84,000 units a year and would have a spare part plant.
Based on data at OICA (International Organization of Motor Vehicle Manufacturers), the ratio to population in Indonesia is 77 to 1,000 as against 397 to 1,000 in Malaysia.
The ratio shows that the market is still highly potential in Indonesia.
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