Sales of Cheap Cars to Intensify With Toyota, Tata Brands
Faisal Maliki Baskoro
Competition to sell cars with a price tag of below Rp 100 million ($10,500) in Indonesia will intensify next year, with distributors flooding the market with brands such as Toyota and Tata.
Astra International through its unit Toyota Astra Motor introduced its latest series: Astra Toyota Agya and Astra Daihatsu Ayla. Tata Motors Indonesia, the local unit of Indian car maker Tata Motors, is also jumping into the fray, with its the latest model Tata Nano CNG.
Low-cost cars manufactured by Astra International, the largest publicly traded company in Indonesia, and Tata Motors are the main attraction the annual Indonesia International Motor Show in Jakarta.
The event, which will be held until Sept. 30, is an opportunity for car manufacturers to showcase their latest products to tap into the largest car market in Southeast Asia, which continues to grow.
Astra International on Wednesday introduced its new low-cost green car, with the price tag expected at less than $10,000. Astra International will sell its eco-friendly cars: Agya and Ayla. The models are being produced jointly by Toyota Motor and Daihatsu Motor — their third car collaboration after the Avanza-Xenia and Rush-Terios models.
Tata on Friday unveiled its Tata Nano CNG, which will use compressed natural gas, as its fuel and will carry a price tag of $2,500 — which is lower than the country’s annual gross per capita income of $3,600.
Earlier this month, Tata started operating from Indonesia with a plan to make the Southeast Asia largest economy as an export base for its product.
Biswadev Sengupta, the president director of Tata Motors Indonesia, said that his company has no intention to compete with Japanese manufacturers.
“On the contrary, we actually wants to learn from their success in operating here in Indonesia for 40 years,” he said on Friday. “We had just introduced ourselves to the Indonesian market, but we will be here for a long time. We believed that the market potential in Indonesia is huge.”
Car ownership penetration in Indonesia is 40 vehicles for every 1,000 persons, which is lower than the ratio Malaysia’s 300 or Thailand’s 140 for every 1,000, Sengupta said. Tata plans to open at least 15 showrooms in the next seven months.
The president director of Toyota Astra Motor, Johnny Darmawan, said that the Agya and Alya cars are the company’s response to the government’s request for a low-cost green car (LCGC).
Sudirman Maman Rusdi, the president director of Daihatsu Astra, said for cars sold for less than Rp 100 million the government should remove the luxury goods tax on LCGC cars. Industry Minister M.S. Hidayat said a regulation will soon be issued regarding incentives for LCGC cars.