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GM to return home amid tight competition in Indonesian car market
The United States-based automotive company announced on Monday that it would permanently halt its vehicle sales in the Indonesian market at the end of March next year.
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Workers assemble cars at a car factory in Karawang, West Java. General Motor announced on Monday that it would permanently halt its vehicle sales in the Indonesian market at the end of March 2020.
(Antara Photo/Rivan Awal Lingga)
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ndonesia’s sluggish car sales have taken a toll on General Motors (GM), which has decided to stop selling cars in the country after falling drastically behind other carmakers in one of Asia’s largest car markets.
The United States-based automotive company announced on Monday that it would permanently halt its vehicle sales in the Indonesian market at the end of March next year.
GM’s Southeast Asia president, Hector Villarreal, said in a statement obtained by The Jakarta Post that the decision was in line with the company’s global strategy to focus on markets that had a clear path to achieve a sustainable profit.
“In Indonesia, we don’t have a specific automotive market segment that can give us sustainable profitability,” he said on Monday, adding that factors like weakening commodity prices and currency pressures also added to the reasons why it chose to permanently stop its sales in the country.
The decision was made less than five years after the company halted the production of its multipurpose vehicle (MPV) brand Chevrolet Spin in June 2015.
The company started producing the MPV with a production capacity of 40,000 cars a year in Pondok Ungu, Bekasi, West Java, in April 2013 to tap into the country’s large MPV market. However, the company failed to compete with the popularity of Japanese carmakers such as Toyota, Suzuki and Daihatsu.
Data from the Association of Indonesian Car Manufacturers (Gaikindo) showed that wholesale figures of Chevrolet — the only GM brand sold in Indonesia — continued to decline since 2017, with 970 units sold in the January to September period of this year. The figure reflects a 48.59 percent year-on-year (yoy) drop from the same period in 2018.
