2013- Tata Motors to set up a manufacturing plant in Jakarta, Indonesia

India might pose to be the largest automobile market in the year 2030, but if talk about present, one of such growing markets in Asia is the Indonesian automobile market. It might not be churning out the profits which will give hangover to the coming years as well, but it definitely poses to be the strongest and rudest market in coming years. Undoubtedly many bigger brands are ensuring that they have their say in the Indonesian market. Even our very own Tata motors are thinking to build a manufacturing unit in Indonesia which will be used to manufacture the small yet promising car Tata Nano.

Right now the plan is under a constant vigilance of the various study teams. They now are checking the feasibility of the plan. Indonesia might be a growing market but is it really worth to pin the elephant. Three of the Tata’s spokesperson gave a green signal to this piece of news as they said, “yes, we will be establishing a manufacturing unit in Jakarta. We will be announcing this piece of news shortly, but till then it is all under wraps.” This plan is basically designed in order to get a foot hold of the large yet untapped markets, and it begins from Indonesia. Next step will include Malaysia, Philippines and Thailand.

A humongous economic growth and the rising confidence in the consumer level credited the Indonesian market to become the fourth largest market in the South East Asian region last year. Also, the decision was influenced by the sales figures of light vehicles which expanded to 2.23 million units from last year making a sales growth of 36%, according to the Asian Automotive market reports by JD Power and Associates in January this year. When asked abut the Indonesian automotive market, Mr Abdul Majeed, Auto Practise Leader, Pricewater House Coopers Llp, said, “Indonesia somehow depicts the Indian market in true sense. Though, the language is different and also the pattern is different, but it is showing some significant signs which say it’s too close to being like the Indian automotive market”.

Experts say that why Indonesia is suddenly in the spotlight is because of its large rural populace. This is one of the major contributing factors in the sales generated in this country last year. Tata motors believe that this factor will help them also. Tata Nano is offered for the lowest of prices and that will suit the budget of rural people. Earlier Tata Motors was planning to expand its facilities in Thailand by introducing Tata Nano to it. But right now those plans have been folded and kept inside the top most shelves. The reason for the same is that out of all four markets listed above, JD Power and Associates said that “if we have to bet against one of them then it will be Indonesia for sure”.

A private study revealed that Indonesia will jump an 11% increase in 2011 year on year. This plan is said to be completed and take a definite shape in the fiscal year 2013. Once they’ll get hold of the production of Tata Nano, the company will also start manufacturing Tata Ace side by side. It is expected that this manufacturing unit will be capable of generating 50,000 units per year both. Currently Tata Motors has asked for the quotations by various key suppliers from Indonesia. Some have already visited India for the same and many other suppliers are supposed to make their trips soon.

While the other officials didn’t comment on this piece of news, Mr Telang, Managing Director, India Operations, said that “we are trying to find out the markets which are somehow matches to the axis of Indian Market and also Indian Geographies”. When asked the same question from Carl-Peter Forster about the same he said, “Currently, the company is planning to churn out 12000 to 15000 Tato Nano per month in Sanand, Gujarat, from March of this year, and I won’t speak of anything else”.

One thought on “2013- Tata Motors to set up a manufacturing plant in Jakarta, Indonesia

  1. Indonesia is unique market,… customer are very loyal to Japanese products, as they set up the market and manufacturing since 1970, however TATA should treat the Indonesia as a single market with ASEAN countries, so that TATA will get competitive tax if the regional contents reach more than 40 %.
    On the other hand most of the Japanese products at least they provide 2 years warranty unlimited mileage. Some brand 3 years 100.000 Km whichever comes first.

    Good Luck.

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