Indonesia expects a new wave of automotive component sector investments to result from the expansion of passenger vehicle production capacity that is taking place in the country. 

Budi Darmadi, director general at the ministry of industry, said he expects 20-30 automotive component manufacturers to announce new spending in the country over the next year, worth a combined US$1.5bn, as a result of new vehicle production capacity being built by automakers including Honda, Suzuki and Nissan.

Darmadi was speaking at this weeks opening of Honda’s new car assembly plant, the company’s second in Indonesia, which has the capacity to make 120,000 Mobilio compact MPVs per year.

Separately, South Korea’s Hankook Tire announced plans to invest a further KRW380bn (US$356m) to expand capacity at its newly built tyre factory in West Java to 6m units a year.

Construction of the that factory was completed in September 2013.