General Motors is considering plans to restart vehicle production in Indonesia, company sources have told just-auto.

A GM Indonesia spokesman said the company is looking at the potential of producing a compact MPV or SUV model for sale in Indonesia and in neighbouring ASEAN countries.

Local reports quoted the Indonesian ministry of industry's director of transportation policy, Syarif Hidayat, as saying that GM may invest up to US$200m to restart production at its Pondok Ungu plant in Bekasi, just east of Jakarta.

The 20,000-unit per year plant was closed down in 2005 after the locally-assembled Blazer model was withdrawn from the market.

GM Indonesia confirmed that it is actively looking to restart production at the plant, but needs to wait until a suitable product becomes available.

There is substantial demand for small MPVs and SUVs in Indonesia, such as the Toyota Avanza/Daihatsu Xenia and the Toyota Rush/Daihatsu Terios respectively, and these are the segments GM Indonesia would like to target.

It would also like to compete more effectively in the compact hatchback segment currently dominated by the Toyota Yaris and Honda Jazz [Fit].

A company source confirmed that "global" GM does not have a small SUV or MPV model to compete in the ASEAN region and may have to wait a few years before one becomes available.

"Production at the Bekasi plant is unlikely to restart until 2012-13", the company insider confirmed.

At present GMI currently sells the Captiva SUV, imported from Thailand, and the Aveo and Estate sub-compact models, but sales are limited.

Sales have slipped sharply in the last 10 years, as GM shifted its priorities to larger, fast-growing markets in the region - namely China.

It has also gone through a re-branding, having dropped the Opel badge in favour of Chevrolet.

In the first seven months of 2008, GMI sold 502 vehicles in Indonesia, for a market share of just 0.2%. The company concedes that significant effort is needed to strengthen its brand in the region.

Tony Pugliese