Volkswagen, the German giant aiming to be the world’s largest carmaker, is set to build a new plant in South-East Asia’s largest economy, according to an Indonesian government minister.
Industry minister Mohamad Hidayat said that the new factory will be in Cikampek, West Java, and that VW is expected to announce the plan officially later this year, according to reports. This should be a full-scale plant, an upgrade from the current assembly plant with Indomobil Group that rolls out Semi Knocked Down (SKD) units of the Transporter and Multivan.
“They [VW] will announce the plan in November or December,” he told reporters after a meeting with company officials in Jakarta. His personal estimate is that the Wolfsburg-based carmaker will pour in an initial investment of 200 million euros (RM883 million).
“It [VW] has carried out in-depth research to understand our market, its competitors, efficient selling price and other things. With its proposed plan, it means it’s ready for competition,” the minister added.
Daily Jakarta Post adds that the German-based automaker might take part in a government-backed green car programme with the possible production of hybrid cars. Under a new regulation, domestic production of eco-cars, dubbed “low carbon emission cars” in the republic, will enjoy tax reduction. Cars capable of 20 to 28 km/l can get a 25% reduction in sales tax, and those that better 28 km/l might enjoy up to 50% tax cuts.
This is happening as Malaysia is trying to position itself as the energy efficient vehicle (EEV) production hub of the region. More details are expected to emerge along with the revised National Automotive Policy (NAP), which has been delayed. The eco-car idea was kicked off in the region by Thailand, which now has Japanese carmakers like Nissan, Honda and Mitsubishi churning out compact, fuel-efficient models in the Kingdom.
If VW is to realise its ambition to be No.1, it needs to start getting serious in ASEAN, a growth market. This is Toyota-land, and while it’s very strong in China, the German carmaker has a tiny presence in South-East Asia, and no affordable big volume seller to go head-to-head with the Japanese brands. VW does local assembly in Malaysia in partnership with DRB-Hicom.
Volkswagen is targeting annual vehicle sales of 10 million in 2018. In 2012, the group sold 9.07 million units, behind GM with 9.29 million and current sales champ Toyota, which sold 9.75 million vehicles.
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Indonesia should send a big thank you card to Dr.M and our incompetent Transport Minister.
If it wernt for them, the plant would be here…
MITI or Transport Ministry???
Bravo to Dr M…the father of Indonesian automotive industry…clap clap to NAP!
Wow! Dr.M is now title as father of automotive industry for both Thailand and Indonesia!
Thanks to all who supported Proton all these years, i’m proud of you all although i myself don’t drive Proton. Haha…
Can pinjam ur Bugatti Veryon over there??
Ha ha ha! No thanks to Dr M NAP
Malaysia hub of this and that, all fail.
Bravo to malaysia goverment automotive policy..
clap! clap!!
So you see how much Malaysia lose out because of Proton and Perodua… For whose benefit? All factories going elsewhere leaving Malaysian with no job no hope!
Hybrid? They would not need a hybrid for that. A Passat 1.6 TDI with 105PS does 26km/l already without hybrid tech…
in europe and america, places like California or London it is all about carbon footprint @ exhaust emission.
seriously, you need to read more to understand. there is reason for toyota petrol-hybrid. similar goes to diesel engine and also diesel-hybrid and the race for superior clean EV.
Wow, Robot fixing the wheel. Can my local tayar shop do that?
It’s about time for me to move out from Malaysia also. Our ministers don’t like us anyway…
malaysia did get some small rewards.. through DRB and VAG at pekan assembly plant. an err, thats all.
Thanks for high unemployment…No wonder banyak tak dapat pekerjaan…
No worries man, soon Proton will design a MUCH BETTER car, it will over take VW & ALL THE JAPS, so simple. just UPGRADE their policy will do. Malaysia NEVER LOOSE ONE, not even in competition, how to loose??
Impose another tax on foreign imported and CKD vehicles and Proton will alive again.
oh come on, people still appreciate dr M brought them “cheap price” good performance car with so so finishing material
GOOD FOR THEM!! Lucky Indons And Thais you have the power of consumer choice…
Our gov is still too arrogant to admit the lousy policy and being stubbornly sticking to an ill faithed path that is destined to failure.
Open up the market and let them compete equally. In biz, its always survival of the fittest not gov politics and cronyism.
I remember some “Women’s Minister” mentioning about Pekan is on track to become some kind of green automotive hub.
Now look what happened?
i never trust that bixxh.. who trust her? u?
That minister is a big bullshiter lar…All just talk
to make things feel good only.Rakyat call it “satay”.
Rm883m not just build the factory make sure DSG problem can be solve
Knowing VW Group, I’d wait for the official announcement from them.
What’s the point of protecting P1&P2? We deserve better quality / safer cars (if not lower prices as some ppl say it will make the traffic worse). That’s our hard earned money & there is no ‘take 2’ for life
But at least we can get a 5 star ANCAP car from Proton now. The only 5 star cars from Toyota are the Prius C and Prius, the rest doesn’t even have the chance to get 5 stars (Camry 2.5 perhaps…).
P1 is on the right path, it’s just that it took them too freaking long, and the cronyism hurts them/their products. Rather than getting the best supplier for parts we get sub par parts cause the supplier has good connections… of course the quality is bad then.
Another huge loss to Borehland. Not to mention the employment such a project would create.
danny, will this make VW cars cheaper in malaysia, somehow?
I feel Indonesia should collectively thank the Bapak of Otomobil, Dr M, for this win. Remember the Proton-VW deal that nearly went through? Well, it didn’t and so we will soon be IMPORTING VW cars from Indonesia instead of having it the other way around. What’s new right?
I would said such a sad news for Malaysia. A Giant auto industry going to invest 200million euro into Indonesia but no in Malaysia.. All big big company shift to Indonesia. And recently don’t know which minister announce that Malaysia going to bring 1.4million Bangladesh as a foreign worker! What for??? Taken our money back their country… Hopeless
looking at the bright side — less kuli roaming on the streets, safer streets….
Our ministers are still sleeping. Still cannot wake up. Sleeping in slumberland. All opportunities fading away. Time to wake up.
Malaysia can rebadge! rebadge!and continue rebadge!.Then sell it even more expensive than original in Pulau Langkawi
market**
The government is an utter failure. After people announce investment then only say want to revise. What kind of stupid people runs this government where the action comes after yesterday’s news?
The government never review their failure, as this happen they will blame the Volkswagen not smarter enough come to Malaysia. They only concern about why never bargain their own pocket.
Is like that…Then some minister will say”If u dont like it get out of the country” Or revoke citizenship
/PR.
we getting behind in any aspect …day in & out…not only in cars…..
VW no ball not dare step into Msia market like other foreign manufacture because they all scare of mighty Proton!
sarcasm
so after this, Golf GTi will cost RM150k??
This reminds me of a very classical quote ” Katak di bawah tempurung” and it suits our G.
Malaysia’s biggest export : Jobs and Opportunities. Malaysia Boleh!
wtf keretak national. kijang now loves VW & we msia luvs indomie, daia, dangdut, indocafe, jarum cokelat ……in & in & in…..
You already know more than me.. hiks. :)
VW doesn’t scare of Proton or Perodua & mostly NAP also doesn’t concern VW much, 100% they scary on our “LABOUR WAGES/SALARY”… Rupiah Vs Dong Vs Bhat Vs Ringgit, definitely Ringgit will be lost one lorrr… No doubt Vietnam, Thailand & Indonesia will good choice for business (higher profit).
how many job opportunity lost?
Million Indonesia working in Malaysia. Hardly any Malaysian working in Indonesia. They have the work force. Somebody above mention about salary too. Minimum from RM 400 to RM 900 screwed up a lot of businesses which charge back to the community. All product in Malaysia was produce by the minimum of salary.
Indonesia will be an obvious choices for VW, at least Indonesia wouldn’t implement a sudden change in policy like Malaysia govt did to exporter in last few quarters.Huge local market and cheaper worker is the main attraction for VW in Indonesia. Plus, when ASEAN market open in 2015, Indonesian car can import to Malaysia, Thailand, Brunei, Singapore and other ASEAN market with low levy or not levy at all.
Sometimes i feel like i’m in Bodohland, not Bolehland.. the reason being, bodoh people commenting like the above.. the main reason why they went to indon is because of the market opportunity there.. plain and simple.. even if Malaysia did not have any auto protectionist policy (which will makes cars more affordable) the market here is not big enough to justify the investment.. go ask the VW dealers here, they’re practically being force to take stocks even when the market is not accepting.. if the car price is the main issue why people are not buying VW, i wonder why Porsche, BMW and Mercedes’s sales are climbing every year.. can’t believe there are so many bodoh’s who have access to internet yet still bodoh..
I am surprised to see comment which forgotten VW was hoping to utilize Proton Tanjung Malim plant when Proton cannot utilize it 100%…or even 50% with Gen 2.
the plan was to use that site to make VW having bigger impact at South east asia….someone interfere so much and in the end VW just seem to lost patience especially there’s other problem within VW. I cannot recall the full details now but VW should have a presence in SEA earlier if not due to some smart guy who think otherwise.
That time the PM was pak lah which mean more than 10yrs ago when Indonesia is not fully recovered from 98 financial crisis and its infrastructure is still in progress
Take that P1! For not making deal with me…(VW). I make deal to those country near u…..