Toyota to build new factory in Indonesia-Nikkei

Reuters, Sept 9, 2011

(Reuters) - Toyota Motor Corp plans to spend nearly 30 billion yen($387.8 million) to build an assembly plant in Indonesia that it hopes to launch in the first half of 2013, the Nikkei business daily reported.

The plan calls for nearly doubling the firm's capacity in that country to about 200,000 vehicles a year, the paper said.

The decision comes after three years of holding off judgement on any plant construction in Japan and abroad, said the business daily.

Japan's leading carmaker seeks to maintain its lead in Indonesia, which is set to become Southeast Asia's largest auto market, the Nikkei said.

The new facility will be built adjacent to its existing factory in the Jakarta suburbs of Karawang and is expected to assemble three subcompact models, including a low-priced strategic vehicle under development for that country, the paper reported.

Last year, auto sales in Indonesia was around 750,000 units, approaching Thailand's roughly 800,000, with the number seen exceeding 1 million units in the coming years, the paper said.

Toyota controls about 60 percent of the Indonesian market when contributions by group firms such as Daihatsu Motor Co are included. But as competition grows with Nissan Motor and Suzuki Motor announcing plans to boost output, Toyota aims to improve cost competitiveness through increased local production, the Nikkei reported.           

(Reporting by Sumit Jha in Bangalore;Editing by Sriraj Kalluvila)