Ten Taiwanese automotive parts companies have announced plans to move their manufacturing operations to Indonesia to take advantage of cheaper production costs.
Ahmad Syafiun, chairman of the association of motor vehicle equipment industries (GIAMM), said the ten Taiwanese companies had proposed their plan to the industry and trade ministry.
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High labor costs in Taiwan had prompted many companies to move their production operations to other countries including Indonesia, Syafiun told the newspaper Bisnis Indonesia last weekend.
He said that a number of component producers from South Korea had also indicated strong interest in investing in the country.
“I think they are very serious about plans to build component factories in the country, as Korean cars have begun to create a market for themselves in Indonesia,” he said.
Meanwhile, PT Timor Putra Nasional, which produces parts for KIA Motors, is negotiating with Korean components companies on a plan to jointly build a plant in its complex.
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