LIUZHOU, China: Indonesia’s component manufacturers will have to be ready for the thousands of Chinese trucks set to flood the domestic market early next year.
The influx of China-made trucks is part of the country’s efforts to expand its market to Southeast Asia, as Dongfeng Liuzhou Motor Co Ltd General Manager Cheng Daoran told Bisnis, and several representatives from component companies incorporated under Dharma Bhakti Astra Foundation (YDBA) during a visit to Dongfeng plant last Saturday.
“We will export 300 Dongfeng Chenglong trucks per year to Indonesia starting December. In addition, the company will also export to Algeria, Saudi Arabia, and other Middle East countries as well as Philippines,” he said.
Dongfeng Liuzhou Motor Co Ltd is an automotive firm owned by Dongfeng Motor Group Co Ltd and Liuzhou Industrial Shareholding Co Ltd. Meanwhile, Dongfeng Motor Group is a joint venture between Dongfeng Motor Co Ltd and Nissan Motor Co Ltd.
The company, which is based in Liuzhou GuangXi China, produces 60,000 commercial vehicles and 50,000 passenger vehicles a year. Several Dongfeng trucks that have been exported were from medium class like Chenglong LZ 5252 GJBM, Chenglong 3252 PDJ, and Chenglong LZ 3253 QDJ.
The aggressive move by China’s manufacturers will hit domestic players hard, PT Aneka Teknik Utama (ATU) President Director Yunus told reporters.
“China’s truck as a new comer is an indirect threat for our component industry since the truck price is about 40% cheaper than Japan’s truck. Thus, the price of components for China’s trucks becomes very cheap,” he said in limited discussion with YDBA in Guangzhou early this week.
ATU is a company that supplies components for dump trucks to several original equipment manufacturers (OEM). He added that China’s cheaper trucks would disrupt commercial car market in Indonesia since the customer may turn away from Japan’s truck products on cheaper prices.
Thus, Japan’s truck sales will immediately drop and affects component orders from Japanese manufacturers as the OEM.
According to YDBA Manager M. Kosasih, China’s truck products that enter domestic market would become a long-term problem, although he also optimistic that the condition would represent a new opportunity for domestic truck component makers.
“It may open up an opportunity for small and medium-scaled component industries because China’s trucks will certainly need an aftermarket.” (t06/ags)