A joint venture between Indonesia’s PT Sokonindo Automobile and Chinese vehicle manufacturer DFSK, a joint venture between Chinese firms Dongfeng Motor Group and Chongqing Sokon Motor Group, is building a USD 150 million vehicle assembly plant in Tangerang, Banten, Indonesia.
According to Alexander Barus, Sokonindo Automobile commissioner, the plant, which will produce 50,000 units a year, will become Sokon’s production base in South East Asia. The plant will be located at the former motorcycle factory of Sanex Qianjing, a joint venture between China’s Qianjing Motor International, Malaysia’s Lion Group, Taiwan’s CPI and Indonesia’s PT Sanex, which ceased production a few years ago.
DFSK has six manufacturing sites in China, producing mini-vans, motorcycles, ATVs and shock absorbers.
The joint venture will produce multi-purpose vehicles (MPV), including diesel-based cars with 1,300cc engines and gasoline-based cars with 1,500cc engines.
The company would focus on the domestic market for the first four years, with plans to start exports in the fifth year.
“In the next five years, we aim to be Sokon’s base production in ASEAN and we also aim to increase local content up to 80% for our products,” said Barus.
The company has signed a partnership agreement with local firm Kaisar Motorindo Industri, sole distributor of the three-wheeled Kaisar motorcycles, which would help Sokon in building aftersales service centers in at least 40 main dealerships across Indonesia. He cited the lack of aftersales service centers as a major obstacle that Chinese-branded vehicles face in penetrating the Indonesian market.
“We are ready to compete in terms of quality, price, delivery and aftersales service and of course, customers have the right to choose the best,” he said.