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DRB-Hicom is planning to export Volkswagens Polo and Jetta to Indonesia in the near future, Bernama reports. According to International Trade and Industry minister Datuk Seri Mustapa Mohamed, the first export batch would comprise 500 units locally-assembled (CKD) at DRB-Hicom’s Pekan plant.

“The export is in line with the government’s aim to see more export for locally-assembled cars, and DRB-Hicom’s objective when it allocated more than RM1 billion in setting up this complex in Pekan. Indonesia will be the first country (exported to) because of the facilities provided by its government for DRB-Hicom to export the cars,” the national news agency quoted him as saying.

Volkswagen Malaysia has been talking about exporting the Polo (Sedan as well as Hatch) and Jetta to ASEAN since late last year. MD Armin Keller said in October 2014 that these models now incorporate 40% local or ASEAN content – a requirement for ASEAN-assembled cars to gain import duty exemptions if they are exported to other countries in the region, under the ASEAN Free Trade Area (AFTA) agreement.

Volkswagen Jetta CKD 4

Right-hand drive markets like Thailand and Indonesia will be the initial focus, but Keller did not rule out producing left-hand drive cars for countries such as Vietnam and the Philippines if the business case “makes sense.” DRB-Hicom builds Volkswagens Polo Hatch, Polo Sedan, Jetta and Passat in Pekan.

However, Volkswagen Malaysia recently previewed the Polo facelift at the plant – we wonder if the model intended for export is this, or the pre-facelift.

Currently, Proton, Perodua (which exports its cars to Indonesia badged as Daihatsu models), Hyundai, Mazda, Peugeot, Volvo and Subaru are exporting cars from Malaysia to other countries in the ASEAN region due to the favourable tax breaks.