AUTOMOTIVE INDUSTRY IN INDONESIA : A CENTURY OF PROGRESS
AUTOMOTIVE INDUSTRY IN INDONESIA : A CENTURY OF PROGRESS
Indonesia had its first encounter with motor vehicles in 1893 , but automotive manufacturing industry didn ’ t begin to boom until the 1970s . As the need for automotive parts grew , so did Indonesia ’ s own automotive parts industry .
The Indonesian automotive component market is primarily made up of two main areas : 1 . Original Equipment Manufacturer ( OEM ) market , which refers to components market for automotive components made specifically for automotive assembling market both domestic and foreign owned .
2 . Replacement Equipment Manufacturer ( REM ) market , which refers to manufacturers of components for the purpose of maintenance and replacement for both domestic , foreign and export automotive components markets .
The automotive components manufactured by Indonesian manufacturers can be categorized into six major categories ; there are Engine components , Electrical components , Transmission components , Suspension components , Chassis components , and Car body parts .
Automotive parts industry in Indonesia organized around certain geographical areas . These areas are typically highly industrialized areas with easy access to infrastructure and energy and / or cluster areas where the similar industry has traditionally grown , which make it easy for new firms to start a business . Or , an area where the automotive parts industry ’ s largest client , the automotive industry itself , is located nearby .
Jakarta ’ s various industrial centers most notably in the Pulogadung and West Jakarta areas house a large number of automotive component manufacturers . The nearby city and regency of Bekasi host one of the most important industrial centers in the country . Bekasi area industrial centers are home to large numbers of automotive manufacturers , particularly assembly plants , and automotive component manufacturer and suppliers .
Bekasi regency also routinely attracts a large amount of investment in automotive industry and automotive component industry . Karawang , a regency neighboring Bekasi to its west , is also an important industrial center , particularly in the assembling of vehicles and manufacturing of automotive components . Tangerang , located just west of Jakarta is also an important industrial center for automotive component and automotive assembling manufacturing .
East Java houses a large number of automotive component industrial centers located in the cities of Malang , Pasuruan , Surabaya , and Sidoarjo .
Central Java is a center of Indonesian small and medium sized business in the automotive component industry . The cities of Tegal and Pati are some of the hotbeds of small-medium sized automotive component makers . Tegal , in particular , is known as the city of workshops and the automotive spare parts ( lower tiered ) capital of Indonesia . This city got it start as spare parts manufacturing center due to a large number of metal-smith industries in the city .
Another important part of the Central Java automotive component industry is the city of Magelang near Yogyakarta which is famous for its “ Karoseri ” industry – which makes custom vehicle bodies ( mostly buses and trucks ) and interiors .
( Source : Ministry of Trade , Indonesia )
6 Trade & Investment Bulletin | Number III / December 2016