SAIC-GM-Wuling JV begins construction of new Indonesian plant 21-Aug-2015 12:44 GMT News Investments

Plant's vehicle assembly section is expected to be completed by late 2017

Three-way Chinese (JV) Shanghai Corporation--Wuling Automobile Company (SGMW) today (21 August) began construction of its new Indonesian plant, reports Dow Jones. The JV plans to produce mini-commercial vehicles and multi-purpose vehicles (MPV) at the new 600,000-square metre factory located in Bekasi. The plant's vehicle assembly section is expected to be completed by late 2017, followed by construction of a facility to manufacture automotive spare parts. SGMW Motor vice-president Yuan Zhijun sounded a positive note, stating, "SGMW Motor Indonesia was established due to the potential and opportunities here. We are confident about our presence in Indonesia."

Significance: SGMW had been considering expansion plans in Indonesia since 2007 and confirmed a potential JV in late 2013. In February 2015, the JV confirmed an investment of USD700 million to build a new plant with an estimated annual production capacity of 150,000 units. The plant will be the first overseas facility for the company. The first vehicle expected to enter production at the facility is a new MPV model under the Wuling brand, as previously reported. IHS Automotive identifies this model as Wuling's 730 C-segment MPV, while we also expect the JV to produce the chassis-cab and van versions of its Sunshine minivan at the plant. Total expected output at the facility is predicted at 13,690 units in 2017, and this is forecast to climb to 27,406 units during 2018 when the JV begins local assembly of an all-new unnamed D-segment MPV based on the 730 MPV nameplate. The kits for these models will be supplied by the automaker's Liuzhou West and East plants in . The JV's new Bekasi plant will mainly cater to demand in the local market, although it will also ship the models to neighbouring markets such as Malaysia, Thailand, and Vietnam in the Association of Southeast Asian Nations (ASEAN) region, according to our data.

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