Jakarta. For years Australia has forged new a name
in innovating off-road technology. Far away from most markets and home
to some of the world’s most unforgiving terrain, parts makers in
Australia like to think they survived by developing a knack for making
do.
“If we didn’t have it we had to make it,” says Ben Bartlett, senior
manager of government relations for the Australian Automotive
Aftermarket Association (AAAA), an industry group that represents
companies that make the specialized head lights, suspension systems and
other accessories owners buy to soup up cars and sports utility vehicles
after they roll off the lot.
In spite of the shutters falling on some of the country’s carmakers
this year, Australia already has wealth of component makers with a track
record making rugged gear.
As Indonesia’s car-loving classes increasingly turn to sports utility
vehicles the (AAAA) is finding a home for their engine cooling systems,
braking and roll control systems here.
Sports utility vehicles and the
four wheel drive versions of people movers like Toyota’s Avanza make up
the fastest growing segment of the car market, the group says
“Interest in Indonesia is at an all time high,” Bartlett says in a statement from the Australian Trade Commission.
For years the group has been on the move participating in trade shows
from Russia to the Middle East that give the country’s makers the type
of exposure that’s crucial for niche products.
This year, though, for the first time, it will participate in the
INAPA auto parts show in Surabaya, the biggest such gathering within the
Association of Southeast Asian Nations.
Some 14 companies from AAAA
will attend, more than comparable with shows in Dubai that have been on
the group’s yearly round of such gatherings for a decade.
“Among our members Indonesia doesn’t just rank first in terms of priority, it ranks first by a fair margin.”
At stake is exposure to a market that will see car sales ramp up to
1.5 million vehicles by 2015 from 1.2 million in 2013 as disposable
incomes among Indonesian families soar after years of rapid economic
growth of roughly 6 percent or more.
This year more than a third of Indonesia’s 67 million households will
earn at least the equivalent of $5,000 a year, the minimum threshold
thought necessary to own a car — that’s up from about a quarter in 2011,
according to AAAA’s marketing data.
What’s more, despite the capital’s traffic problems, relatively few
Indonesians own a car in comparison to their neighbors. Out of every
1000 people here, 32 own a car, while in Malaysia, 300 people do.
To be sure, many of those would-be drivers are opting for modest
multipurpose vehicles — people movers known as MPVs that can transport
entire families of seven or more at a time.
But it’s the specialized
four-wheel drives that are attracting attention because they are more
likely to be kitted out in the equipment that make off-roading safer and
more fun. Nearly every big Indonesian city has a four-wheel drive club.
In 2011 5,521 four wheel drive SUVs rolled off the lot a jump in sales
of 44 percent from the previous year, AAAA said.
“Ownership of pickup trucks, SUVs and four wheel drives offer huge opportunities in Indonesia,” Bartlett says.
Some of that enthusiasm has to do with the parallels between markets:
concentrated population centers with increasingly wealthy car owners.
Far-flung outposts centered on mining and palm oil are knit together
with rough roads.
“Poor suspension in those sorts of areas makes for a miserable ride,” Bartlett says.
“Australians outside of the cities know a thing or two about that.”
But in Australia carmakers are pulling out. In February, Japan’s
Toyota Motor Corporation Australia was the last of four companies that
said it would stop making cars in Australia — in Toyota’s case by 2017.
General Motors, Ford Motor and Mitsubishi Motors have either already
closed plants or are winding them down.
But the closures were matched with announcements in Indonesia of
automotive expansion, shaking up a market that has long been dominated
by Japanese makers with their own supply chains. About two thirds of all
cars sold in Indonesia are from Japanese makers, a bigger proportion
than in Japan itself.
General Motors has already taken its long shuttered factory out of
mothballs. Volkswagen will start making cars in West Java by 2017 and
Ford is planning a factory in Indonesia as a counterweight to Thailand
where political turmoil threatens supply chains.
That influx of the biggest names in the automotive business opens up
new opportunities for suppliers. But securing clients like those won’t
be easy, says Richard Reilly, chief executive of the 85-member
Federation of Automotive Products Manufacturers, who visited Indonesia
last month as part of an industry mission aimed at expanding trade.
“We used to have four carmakers in our backyard. The dynamics of the
industry have changed,” Reilly said to AusTrade. “Our guys have to show
that we have better products and that they’re different from the rest.
They can’t be commodity items.”
Source : JakartaGlobe
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Australian Off-Roading Becomes a Niche Market in Indonesia
Written By Unknown on Sunday, 27 April 2014 | 06:40
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