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Local content requirement for cars to hit 90% by 2019: Industry Ministry
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This photo displays impact copolymer polypropylene resin and ICP compounded resin, raw materials used to make plastics components for car interiors at moulding company PT Sugity Creatives' site in Cibitung, West Java. The firm supplies components for PT Toyota Motor Manufacturing Indonesia. Toyota sources resin locally from petrochemical giant PT Chandra Asri Petrochemical. (JP/Stefani Ribka)
T
he Industry Ministry plans to raise the local content requirement for cars to 90 percent by 2019 from 60 percent at present to strengthen the national automotive industry and create more jobs.
“Today, the local content requirement has reached 60 percent but we will push this to 90 percent by 2019,” said Industry Minister Airlangga Hartarto during a visit to a plant operated by moulding firm PT Sugity Creatives on Thursday.
(Read also; Astra Daihatsu to produce local cars by 2019)
The goal is realistic because supporting industries like steel and plastics resin are on their way to increasing their production to supply the necessary raw material for the automotive industry, he added.
The national steel industry has 400,000 tons of annual steel capacity – produced by PT JFE Steel Galvanizing Indonesia (JSGI). The industry’s capacity will hit 800,000 tons by 2019.
PT Chandra Asri Petrochemical (TPIA), the largest maker of plastics resin for automotive components, is on its way to increasing production of the substance from 3,000 tons last year to 25,000 tons by 2019.
Local content requirement is calculated from origin of raw material, where the products are designed, planned, assembled and packaged as well as the citizenship of the workers used in the production process. (bbn)
