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Indonesian component industry lagging behind.

Though growing, the country's component industry could not fully support the country's automotive industry. The country is still lagging behind many other countries in this regions such as China and Thailand in component industry. In Thailand, a number of world class car makers have built component factories making that country a production base for car components. Indonesia has only car assembling plants.

The market of automotive components in Indonesia has grown in he past several years to follow the trend of motor vehicle production. According to the Association of Car and Motorcycle Equipment Industries (GIAMM), total value of component sales recorded by its members in 2007 reached Rp55.74 trillion or an increase of 35.9% from 2006's Rp41 trillion. The increase followed the growing sales of motor vehicles.

However, locally produced components are facing tight competition from counterfeited products. In addition, the small and medium producers that dominate the component industry in the country could not yet fully utilize the market opportunities which require high standards and specifications. Based on data at the Industry ministry, exports of automotive components by small and medium producers in 2006 reached US$ 908.5 million with export destinations including the Philippines, Britain, Vietnam, Japan, Taiwan, Brazil, Malaysia, China, etc.

In 2009, sales of automotive components especially for use as original equipment by motor vehicle factories (OEM), is feared to be heavily depressed under the global financial crisis. Sales of motor vehicles are forecast to decline. Car sales are predicted to fall to only 450,000 units from 603,779 units last year and sales of motorcycle are expected to reach only less than 6 million units. Orders from the market including from factories for use as original equipment and from market for use as replacement have declined. The decline is sharper in order from factories. The impact is not as sharp in after market as the population of cars remain large. Demand from after market is larger.

Producers and production capacity

Large automotive component factories in the country are joint ventures between local companies and world automotive principals such as Honda, Suzuki, Mitsubishi, Toyota, etc. Without partnership with the foreign principals, local companies could not expand. Even with partnership with the foreign principle, the country's component industry could not yet meet the domestic requirement. Local products of component industry are used mainly by car or motorcycle assembling industries.

Some products of major automotive component producers such as those of Dies, Jig & Stamping are produced by a number of companies like PT Dharma Precision Part, PT Fuji Technical Indonesia, PT Kyoda Mas Mulia, etc. The products are used by Astra Otopart, PT Ichikoh Indonesia and PT Indo Safety Sentosa and PT IRC Inoac Indonesia.

The car industry of the Astra Group is supported by tens of non Astra component producers that produce various types of component from engine electrical system, engine system, power trains, brake system to plastic products.

Based on data at GIAMM, currently the domestic market of automotive components is competed by around 350 companies with a total investment value of Rp7.5 trillion employing 120,000 workers.

Most producers of components are small and medium industries that could not fully meet the standard quality and specifications.

Sales Increasing

The domestic market is potential for automotive components with the continued increase in the production of motor vehicles. GIAMM said the sales of 10 products of main components produced by GIAMM members were valued at Rp34.95 trillion in 2007 or a surge of 75% from Rp19.97 trillion in he previous year.

Altogether, the total value of component sales by GIAMM members in 2007 was Rp55.74 trillion or an increase of 35.9% from Rp41 trillion in 2006. In 2008, sales were around at Rp 72.46 trillion.

Astra and Indomobil Groups largest producers of components

Major automotive companies--the Astra Group and Indomobil Group--dominate component industry in Indonesia.

PT Astra Otoparts, which constitutes a network of component industry of the Astra Group, consists of 28 companies producing and marketing core spare parts needed by the Astra Group and other car makers.

Astra Otoparts has established distribution channel through retail outlets named Shop & Drive and Super Shop & Drive that deal with consumers. Shop & Drive concentrates on the sales of storage battery, lubricating oil, shock breaker and fast moving accessories. The retail network of Shop & Drive operates as franchise for medium scale business people with a relatively small investment. Currently there are 45 outlets of Shop & Drive in Indonesia.

Super Shop & Drive is more complex selling not only Astra spare parts but also tires, brake, and wheel rims and offering balancing and spooring service. Astra Otoparts has a 20% share of the market of automotive components in Indonesia. In addition, production of Astra components is also sold to replacement market and export markets.

Astra Otoparts has expanded operations to Vietnam by building factory producing motorcycle components in Hanoi with an investment of Rp20 billion. The component factory started operation late 2007 in cooperation with local investor to produce rubber parts.

In 2008, Astra Otoparts spent Rp300 billion in loan and equity to expand its production capacity.

Meanwhile, Astra Honda Motor (AHM) which produces Honda motorcycles chalked up Rp1.4 trillion in the sales of spare parts in 2008. This year the company hopes to increase sales by 21% to Rp1.7 trillion. Sales of spare parts increase as under the present condition, consumers tend to restrain from buying new motorcycles by choosing to maintain old ones that would need more spare parts. Fast moving parts, like brake canvass, sparkplugs, gasoline filter, lubricant oil filter, etc. Fast moving parts contribute 70% to the total sales of Honda motorcycle spare parts.

Meanwhile, in 2008 Toyota Astra Motor (TAM) built spare part center in the Cikarang Barat Industrial Estate with an investment of Rp249 billion. The spare part center is the second owned by the company after one in Sunter, North Jakarta. The spare parts center could receive, store, and distribute more than 100,000 spare parts of Toyota to 30 countries, 193 branches and 166 workshops all over Indonesia. The spare parts center is expected to be able to meet demand until 2015.

Around 65% of the more than 100,000 spare parts are supplied by 150 local component producers and 35% are imported from Thailand and Japan. Spare parts imported from Japan are only those which arte produced with high technology. Spare parts from Thailand are mainly ones which are part of Completely Build Up (CBU) cars such as Toyota Camry.

The Cikarang Spare Part Center supplies spare parts for cars produced by PT Toyota Motor Manufacturing Indonesia (TMMIN) for exports such as Kijang Innova and Fortuner, Toyota Avanza and Toyota Rush, which is produced by PT Astra Dhaihatsu Motor. Part of Toyota cars produced in Indonesia are exported to Thailand, Brunei, Malaysia, and the Philippines, Saudi Arabia, and the United Arab Emirates, Mexico and Venezuela, Sri Lanka, Bangladesh, and South Africa. Sales of spare parts from the Center in Cikarang recorded a turnover of Rp1 trillion in 2008 including 16% in exports. In 2009, the turnover is predicted to rise to Rp 1.2 trillion.

Similarly the Indomobil Group is backed up by a number of component producing subsidiaries like PT Indo Vido Instrument, PT Jideco Indonesia, PT Kotobukiya Indo Classic Industries, PT Nihon Plast Indonesia, PT Sumi Indo Wiring Systems, PT Yamatogomu Indonesia, etc.

Japan dominant

Currently there are 180 automotive component companies and 135 of them are members of GIAMM. Like automotive industry, component industry in the country is also dominated by Japanese companies.

According to the Jakarta office of Japan External Trade Organization (JETRO), there are 62 Japanese companies operating in business related to component industry in Indonesia representing major Japanese brands like Denso, Toyota Tsusho, Aisin Seiki, Bando Electric, Izumi Industries, Nittan Valve, Kayaba Industries, Sanden, Yuasa Corp. etc. Among the 135 members of GIAMM, 76 are foreign companies (PMA) and 59 domestic (PMDN) companies.

Import duties on component basic material 5%-20%

After the end of the policy of zero import duty in May, 2008, component basic materials are slapped again with an import duty of 5% to 20%. In 2007, the competitiveness of automotive component industry was relatively strong with the incentive provided by the government in the form of import duty exemption with a regulation of the finance minister No. 34/PMK.011/2007. The zero import duty policy which was effective for 12 months ended on May 4, 2008.

GIAMM said the re-imposition of the import duties of 5%-20% could weaken sales and result in slowdown in production of components. Meanwhile, automotive industrialists said the import duties are very much not in harmony with the 0% import duty on automotive components. The policy will hamper development of the country's component industry, which still depends on imports for basic materials.

Based on data at the Central Bureau of Statistics (BPS), imports of components of cars and motorcycles rose 10.24% in 2007. The increase showed dependence of the country's automotive industry on imports for components. The value of imports of components in HS 87 totaled US$ 2,41 billion in 2007 up from US$2.16 billion in 2006.

The country's automotive industry is still heavily dependent on imports for components mainly as the local producers are bound by the policy of their foreign principals in the use of basic material, technology and marketing. For example, Honda Prospek Motor, the producers of Honda cars the country uses local component making up only 40% of the total components.

Astra Daihatsu Motor, the producer Daihatsu cars with a higher local content of 70% with imported components which are not produced in the country making up the remaining 30%. Components like interior automatic electrical and a number of base steel commodities are not yet produced locally.

Meanwhile, in order to maintain competitiveness, automotive producers have to increase their quality to meet the standard quality.

In May, 2008, the standard guaranteeing the quality of automotive spare parts called Q-Seal was announced by three automotive organizations--The Indonesian Association of Automotive Technical Experts (IATO), Indonesian Automotive Center (SOI), and the Indonesian Association of Vehicle Workshops (Asbekindo). IATO SAE Indonesia is a non profit organization. Currently around 75% of motor vehicles in the country are locally assembled.

The issuance of the quality seal, is expected to encourage the country's component industry to improve their quality.

Spare parts account for 60% operating cost of public transport vehicles

Spare parts constitute the main components for vehicles. Spare parts, therefore, contribute considerably to the operating cost of public transport vehicle. According to the West Java Land Transport Organization (Organda), spare parts account for 60% of the production.

Meanwhile, around 20%-30% of the income is used to cover operating cost. Generally, in the first three years of operation, spare part cost makes up 20% of the total operating cost. In the following years the percentage may rise to 60%. In addition to oil fuel (BBM), the tariff of public transport is set on a number of cost components including lubricant oil, brake fluid, tires, maintenance cost, driver salary, spare parts, terminal fee, etc.

Indirect costs include depreciation of vehicle, vehicle tax, route license, fee for test to determine if the vehicle is fit for operation, illegal levies, etc.

Ideally, indirect cost is not more than 16% of the total cost and direct cost is around 50%. Around 22% of the direct cost is for spare parts.

The main distributors determine the prices of spare parts in the regions. Local traders use the price list from the producers as reference in setting their selling prices in the regions generally with a profit margin of at least 10% of the selling price. As a result the selling prices of spare parts set by local traders could be 60% higher than the original price from factory.

Spare part incentives

The price of spare parts has increased 20% since December, 2008. The price hike could not be controlled by the government as they depend much on the rupiah value against the U.S. dollar. Traders bought spare parts six months earlier when the dollar price was lower and they maintain the price in dollar equivalent at the time of purchasing.

Organda and the Chamber of Commerce and Industry urged for a cut in the prices of spare parts. They also asked the government to allow imports of used spare parts.

So far import tax facility has been given only to operators public transport service. Edy Putra Irawady, a deputy at the office of the chief economics minister, said the government will provide incentive in the form of spare part import duty cut worth Rp79 billion. The incentive is offered in a bid to cut transport fare.

Controversy in the transport tariff

In the period from December, 2008 to January, 2009, the government three times cut the prices of BBM--the price of premium gasoline was cut from Rp5,000 to Rp4,500 per liter and the price of automotive diesel oil was cut from Rp4,800 to Rp4,500 per liter.

A number of provinces have adjusted their transport tariffs to the government policy of cutting the BBM prices. In West Java the inter city transport tariff has been reduced 8%-10% and city transport tariff is reduced 10%-11%.

Organda, however, said transport companies still face problem with the high prices of spare parts. Transport service operators also complain about rampant illegal levies. Although the prices of BBM have been reduced to the level the same as in May 2008, the transport tariff could not be immediately cut because of the high prices of spare parts and illegal levies.
Table--1

Producers of automotive components and production capacity -- 2007

Types of Producers Production
Component capacity

Dies, Jig & PT Dharma Precision Parts --
Stamping PT Fuji Technica Indonesia 500,000 units
 PT PT Kyoda Mas Mulia --
 PT Metindo Era Sakti 90,000 units
 PT Waja Kamajaya Sentosa --

Frame/Chasis PT Gemala Kempa Daya 35,180 units
 PT Yudistira Utama 9,000 units
 Indonesia

Axle PT Hidraxle Perkasa 5,000 units
 PT Inti Ganda Perdana 365,000 units
 PT Waja kamajaya Sentosa 150,000 units

Shock Absorber PT Ionuda 600,000 pcs
 PT Kayaba Indonesia 2,400,000 pcs
 PT Showa Indonesia Mfg 1,000,000 pcs

Leaf & Coil PT Chuhatsu Indonesia 15,000 tons
Spring PT Indo Spring Tbk 30,000 tons
 PT Muara Teweh Spring 6,960 tons

Brake System PT AT Indonesia 660,000 pcs
 PT Bakrie Tosanjaya 8,400 pcs
 PT Braja Mukti Cakra 5,000,000
 PT Chemco Harapan units
 Nusantara 400,000 sets
 PT Indo Prima Gemilang 9,000 sets
 PT Indofacing Indonesia 9,000 sets
 PT MK Prima Indonesia --
 PT Pakarti Riken Indonesia 3,600,000 pcs
 PT Sanoh Indonesia 29,000 tons
 PT Selamat Sempurna Tbk 400,000 pcs
 PT Tri Dharma Wisesa 400,000 pcs
 PT Waja Kamajaya Sentosa 525,000 pcs

AC,Compressor, PT Denso Indonesia 370,000 units
Evaporator PTSelamat Sempurna Tbk --

Safety Belt PT Autoliv indonesia 500,000 units
 PT Sungwoo Indonesia 260,000 units

Engine Part/ PT AT Indonesia --
Assy PT Astra Daihatsu motor 80,000 units
 PT Astra Otopart-div.Nusa --
 metal
 PT Bakrie Tosanjaya 2,250 tons
 PT Baninusa Indonesia /month
 PT Edico utama 6,000,000 pcs
 PT Federal Izumi 400,000 pcs
 Manufacturing 30,000 pcs
 PT Federal nttan Industries
 PT Honda Prospect Motor 26,370 units
 PT Jibuhin Bakrie Indonesia 300,000 units
 PT Mitsubishi Krama Yudha 420,000 pcs
 Motor Mfg 156,000 units
 PT Pakarti Riken Indonesia
 PT Toyota Motor --
 Manufactring Indonesia 170,000 units
 PT Wahana Eka Paramitra
 320,000 units

Clutch & Clutch PT Aisin Indonesia 1,850,000 pcs
Facing PT Exidy Indonesia --
 PT Indo Facing Indonesia --

Filters PT PT Andhi Chandra 4,000,000 pcs
 Aotomotive
 PT Buanatama Metalindo 1,800,000 pcs
 PT Denso Indonesia 300,000 pcs
 PT Duta Nichirindo Pratama 1,800,000 pcs
 PT HRL International --
 PT Panata Jaya Mandiri 100,000 pcs
 PT Selamat Sempurna Tbk 5,000,000 pcs

Gasket PT HRL International --
 PT NHK Gasket 29,200,000
 PT Nichias Leakless pcs
 Telison Gasket 10,000 units
 PT Nichias Rockwool
 Indonesia 876,000 pcs
 PT Partuni Perdana
 1,310,000 sets
Exhaust Pipe PT Cipta Saksama 750,000 units
& Muffler Indonesia 500,000 units
 PT Ionuda --
 PT Pamindo Tiga T 3,120,000
 PT Selamat Sempurna Tbk units

Body/Pressed PT Astra Daihatsu Motor 70,000 units
Part & PT Dharma Polimetal --
Component PT General Motors 30,400 units
 Indonesia 30,000 units
 PT Honda Prospect Motor 70,000 units
 PT Inti Pantja Press Industri --
 PT Inti Polymetal --
 PT kyoda mas Mulia 15,000 units
 PT Mekar Armada Raya 120,000 units
 PT Mitsubishi Krama Yudha
 Mfg 850,000 m2
 PT Pamindo Tiga T 53,892,000
 PT Subur Djaja Teguh pcs
 PT Sugity Creative 14,400 units
 PT Waja Kamajaya Sentosa --
 PT Yudistira Utama 9,000 units
 Indonesia

Rubber Parts PT Arai Rubber Seal 250,000,000
 Indonesia pcs
 PT IRC Inoac Indonesia 16,600 tons
 PT Indokarlo Perkasa --
 PT Pong Codan Indonesia --
 PT Yamatogumu Indonesia 180 tons
 PT Bando Indonesia 8,000,000 pcs
 PT Kotobukiya Indo Classic 42,000 sets
 Industries

Wheel Rim/ PT Bangun Sarana Alloy 423,000 pcs
Alloy PT Exel Metal Indonesia 180,000 pcs
 PT Pakoakina 105,000 pcs
 PT palingda nasional 900,000 pcs
 PT Mesindo Alloy Wheel 240,000 pcs
 Corp.

Speedometer PT Indo VDO Instrument --

Spark plug PT Denso Indonesia 14,000,000
 PT Multi Prima Sejahtera pcs
 PT NGK Busi Indonesia 55,000 units
 18,000,000
 pcs

Radiator PT Central Karya Megah --
 utama
 PT Denso Indonesia 40,000 units,
 PT Selamat Sempurna Tbk 1,120,000
 PT Three star Indonesia units
 250,000 units

Transmission PT Honda Prospect Motor --
 PT Wahana Eka Paramitra 320,000 units

Wiring PT EDS Manufacturing 400,000 sets
Harness Indonesia
 PT Delphi Automotive --
 System 60,000 sets
 PT Indo Prima Gemilang 1,200,000 sets
 PT Sumi Indo Wiring
 Systems

Electrical PT Denso Indonesia 200,000 pcs
Componen PT Ekamitra Jayatama 750 tons
 PT Hamaden Indonesia Mfg 5,000,000 pcs
 PT Ichikoh Indonesia 200,000 pcs
 PT Indoniles Electric parts 9,000,000 pcs
 PT Jideco Indonesia --
 PT Kyoda Mas Mulia --
 PT Lippo Melco Auto Parts 200,000 units
 PT Mitsuba Indonesia --
 PT Nikko Cahaya Electric 102,000 units

Seat & Interior PT Abadi Barindo Autotech --
Componen PT Ateja Multi Industri --
 PT Indo Safety Sentosa 120,000 sets
 Industry
 PT Karya Bahana Berlian 200,000 units
 PT Meiwa Indonesia 4,250 tons
 PT Mastrotto Indonesia --

Plastic parts PT Astra Otopart 48,000 sets
/Accessories Div.Adiwira Plastik
 PT Cipta Kreasi Prima 2,400,000 pcs
 Muda 100,000 pcs
 PT Dasa Windu Agung 750 tons
 PT Ekamitra Jayatama --
 PT Frina Lestari Nusantara 200,000 pcs
 PT Ichikoh Indonesia 1 billion pcs
 PT 3 M Indonesia 4,250 tons
 PT Meiwa Indonesia 4,600 units
 PT Sugity creative 5,660 tons
 PT Usra Tampi Indonesia 1,000 tons
 PT WIKA In-Trade

Steering PT Astra Otopart Div. --
System Adiwira Plastik
 PT Dasa Windu Agyung 10,000 pcs
 PT Honda Prospect Motor --
 PT Nihon Plast Indonesia 120,000 pcs
 PT Showa Indonesia Mfg. 360 pcs

Battery PT Century Batteries 200,000 pcs
 Indonesia
 PT GS Battery 1,400,000 pcs
 PT Niprest Tbk --
 PT Trimitra Batterai prakasa 1,100,000 pcs
 PT Tri Mega Baterindo 180,000 pcs
 PT Yuasa Battery Indonesia 1,800,000 pcs

Others PT Garuda Metalindo 12,000 tons
 PT Garuda Metal Utama 2,500 tons
 PT Hi-lex Indonesia --
 PT Hilex Parts company 46,000,000
 PT Indobaja prima Murni pcs
 PT Jakarta --
 Martenlogamindo 10,000 tons
 PT Kyoda Mas Mulia --
 PT Menara Terus Makmur 630 tons
 PT Morita Tjokro Gearindo 1,500 tons

Types of Users
Component

Dies, Jig & Astra Otoparts, Suzuki, Astra
Stamping Daihatsu, Nissan Motor,
 Stanley Electric, Honda Lock,
 Hilex Indonesia, Mitsubishi,
 Honda, Ichikoh Indonesia, Indo
 safety sentosa, IRC Inoac

Frame/Chasis Astra Otoparts, General Motor
 Indonesia

Axle Toyota, Daihatsu,

Shock Absorber General Motor Indonesia,
 Isuzu, Nissan Diesel, Hyundai,
 Kancil, Futaba Nusantara.

Leaf & Coil Toyota, Isuzu, Hino, Nissan,
Spring Mitsubishi.

Brake System Toyota, Daihatsu, Mitsubishi,
 Suzuki, Isuzu, Hino,Nissan
 Diesel, Yanmar diesel,Exedy
 Indonesia, Aisin Group, Honda,
 Daimler Chrysler, Nissan,
 Prapat Tunggal Cipta, Akebono
 Corp. Asia, Astra Otopart.

AC,Compressor, Toyota, Daihatsu, Suzuki,
Evaporator Mitsubishi, Nissan, Isuzu, Hino,
 Dailer Chrysler.

Safety Belt Toyota

Engine Part/ Toyota, Daihatsu, Mitsubishi,
Assy Suzuki, Astra Group, Isuzu,
 Hino, Nissan Diesel, Yanmar,
 Honda.

Clutch & Clutch Astra Group, Mitsubishi,
Facing Suzuki, Daihatsu, Isuzu,
 Toyota, Nissan, Honda, Ford,
 Hyundai, Aisin Group, Exidy
 Indonesia

Filters Isuzu, Hino, Suzuki, Daihatsu,
 Nissan, Hyundai, Mitsubishi,
 Toyota Honda, Units ed
 Tractor, Hexindo Aditama,
 Daimler Chrysler, Nissan
 diesel.

Gasket Toyota, Daihatsu, Pantja
 Motor, Suzuki, Astra Group.

Exhaust Pipe Hyundai, General Motor
& Muffler Indonesia, Isuzu, kancil,
 Mitsubishi, Honda, Daimler
 Chrysler, Nissan, Hino.

Body/Pressed Suzuki, Daihatsu, Kayaba,
Part & Showa manufacturing
Component Indonesia, Tri Dharma Wisesa,
 Honda, Isuzu, Stanley Electric,
 Mitsuba Indonesia, Nippon
 Seiki, Ichikoh Indonesia,
 Mitsubishi, Denso Indonesia,
 Toyota, General Motor
 Indonesia

Rubber Parts Isuzu, Honda, KIA, General
 Motor Indonesia, Daihatsu,
 Toyota, Mitsubishi, Suzuki,
 Nissan Motor, Hyundai.

Wheel Rim/ Speedy Corp-Australia, Partex
Alloy Trading UEA, Toyota, daihatsu,
 Hyundai, Isuzu, Suzuki,
 Mitsubishi, Nissan, Hino.

Speedometer Suzuki

Spark plug Toyota, Daihatsu, Suzuki,
 Mitsubishi Nissan, Mazda,
 Ford.

Radiator Toyota, Daihatsu, suzuki,
 Mitsubishi, Nissan, Isuzu, Hino,
 Daimler Chrysler.

Transmission Honda, Astra Group

Wiring Isuzu Japan, General Motor
Harness Thailand, General Motor North
 America, Mitsubishi Cable
 Industry japan, Jurid Werke
 Germany., Honda, Nissan,
 Suzuki, Toyota.

Electrical Toyota, Daihatsu, Suzuki,
Componen Mitsubishi Nissan, Isuzu,
 Hino,Nissan\, Nissan Diesel,
 Stanley Electric, PT Hilex
 Indonesia, IRC Noac Indonesia

Seat & Interior Toyota, Nissan, Suzuki,
Componen Daihatsu, Honda, Mitsubishi.

Plastic parts Toyota, Daihatsu, Mitsubishi,
/Accessories Isuzu, PT Trimitra, PT Sinar
 Terang, Suzuki, Hino, Honda,
 Kia, Nissan. General Motor, PT
 Denso Indonesia.

Steering Toyota, Daihatsu, Mitsubishi,
System Isuzu, Suzuki, Honda.

Battery Astra Group, Toyota, Daihatsu,
 Isuzu, Mitsubishi, Honda,
 Suzuki, Honda, Hino.

Others Toyota, Daihatsu, Mitsubishi,
 Hino, Isuzu, Nissan Diesel,
 Honda, Suzuki, Mercedes
 Benz, Ford, Mazda, Nissan, PT
 Indospring, Stanley Elwctric,
 PT Indosafety Sentosa, Ichikoh
 Indonesia, PT Mitsuba
 Indonesia, IRC Inoac
 Indonesia.

Source: GIAMM

Table--2
Value of sales of component products, 2006-2008

 Sales Growth
Year (Rp trillion) (%)

2006 41.00 --
2007 55.74 35.9
2008 72.46 30.0
Average growth 32.95

Source: GIAMM

Table--3
Number of companies and types of component products, 2007

Types of Component PMA PMDN Total

Engine component 30 18 48
Engine manufacturing 7 1 8
Filter 2 6 8
Battery 3 3 6
Gasket 4 2 6
Alternator 5 0 5
Starter motor 5 0 5
Radiator 2 2 4

Source: GIAMM

Table--4
Import duty on component basic materials

Types of cars Parts/Components April 2007 May 2008

Passenger Cars Material for component 0% 5%-20%
Minibus production
Jeep (4x4)
 Blank (excluding precious 0% 5%-20%
 metals)

 IKD component (pistons s, 0% 5%-20%
 Gear boxes)

 Other component (maximum 0% 5%-20%
 Rates Drive)

Source: Finance Ministry, Industry ministry

Table--5
Components of tariff of transport cost

Description %

a. Direct costs 50
 --BBM cost, lubricant oil cost,
 --brake fluid and tire costs
 --maintenance cost
 --spare part cost
 driver' salary
 --Terminal fee
b. Indirect cost 16
 --vehicle depreciation
 --vehicle tax
 --Route license, fit for operation test
 --operating administration
 --illegal levies, etc.
c. Other costs 34
Total 100

Source: ICN
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Title Annotation:INDUSTRY
Publication:Indonesian Commercial Newsletter
Date:Jan 1, 2009
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