India’s Tata Motors announced plans to make Indonesia its main production base for southeast Asia, as part of a revised expansion strategy for the region.
The vehicle market in Indonesia has expanded sharply in recent years, reflecting strong domestic consumption and high investment growth.
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In 2012, sales increased by 25% to 1.1m units and by 12% to 601,000 units in the first half of 2013.
With its population of 245m, Indonesia is widely expected to become the largest south-east Asia market in the near future.
Tata plans to launch sales operations in the country in September with the intention of building a local assembly plant once volume grows to sufficient levels in three to four years. It plans to have seven dealers operating by September and 15 by March 2014.
The company eventually plans to increased local content to over 40% which would allow duty free exports to other markets in the ASEAN bloc.
