Tata Motors to Enter Commercial Market

Muhamad Al Azhari

Tata Motors Indonesia plans to introduce commercial vehicles into the Indonesian market, the company said in a statement on Wednesday.

Biswadev Sengupta, the president director of the company — which holds the exclusive right to sell Tata Motors’ cars in Indonesia — said they were encouraged to enter the commercial vehicle market after witnessing the nation’s strong economic growth.

“Our research outcome showed a huge opportunity for us to tap the commercial market here,” he said, adding that Tata Motors will offer cars with affordable price tags.

Sengupta said the company planned to introduce three models — Tata Super Ace, Tata Ace Ex and Tata Xenon — in the second half of this year.

“In Indonesia, the small-sized commercial car and mini pickups are growing,” Sengupta said.

“It contributes to 50 percent of the total commercial car market. This will be a challenge for Tata Motors to answer to the need of Indonesian consumers, especially for the small and medium enterprises [SMEs].”

Tata Motors Indonesia begun operating in Indonesia in September 2012.

The company flagged a plan to make the country, which is the biggest economy in Southeast Asia, as an export base for its products.

Sengupta said in September that Tata Motors Indonesia would have a long-term presence in Indonesia as the market potential is huge.

Penetration of cars in Indonesia remains lower than its neighboring countries, Sengupta said in December, with only 40 vehicles per 1,000 people in Indonesia. That compares to Malaysia’s 300 and Thailand’s 140 for every 1,000.

In September, Sengupta unveiled the company’s plan to open at least 15 showrooms in the next seven months.

Tata Motors Indonesia has sold more than 7.5 million cars worldwide and it is the fourth biggest bus and truck manufacturer in the world.

Its products have been marketed in Europe, Africa, Middle East, South Asia, Southeast Asia and the United States.

Helped by a low-interest rate environment and rising middle class numbers, Indonesia saw a strong 26 percent year-on-year rise in car sales in the January-November period. Sales were booked at 1,026,758 units, according to data from the Indonesia Automotive Industry Association (Gaikindo).

Gaikindo executive Jongkie D. Sugiarto said in mid-December that the industry was back on track to book a projected figure of 1.1 million sales by the end of 2012.

Car sales data for the whole year of 2012 have not been released.