After India and Russia, Datsun Indonesia gears up, Nissan opens 2nd plant

Nissan has inaugurated its 2nd plant in Purwakarta, Indonesia. The new manufacturing facility stands at an investment of 33 billion yen, an important aspect of the automaker’s market expansion plan stated in its 6 year mid-term business plan, Nissan Power 88.

Nissan Group AsiaThe 60,000 sq. m facility includes body assembly, paint, trim and chassis operations and will take Nissan’s production capacity in Indonesia from 100,000 units per year to 250,000 at full ramp-up, while generating up to an additional 3,000 jobs here.

Initial production is dedicated to assembling Datsun vehicles for Indonesian customers. Since Datsun’s comeback with Datsun Go launch, the little car has already clocked sales of 5000 units in India. Nissan Motor Chief Competitive Officer (CCO) Hiroto Saikawa highlighted the importance of Indonesia and quality leadership and said, “By investing in a second plant in Indonesia and leveraging the global manufacturing capabilities of the Nissan Production Way, we are now able to further satisfy the increasing demand of Indonesian customers,” Saikawa said. “I have absolute confidence that the vehicles produced here will be world-class in terms of quality and that we will continue to deliver exciting products to our valued Indonesian customers.”

The approval of Nissan’s Low Cost Green Car (LCGC) program license helps it enter the LCGC segment that’s expected to be the growth engine for motorization in Indonesia. Nissan expects to sell more than 90,000 units in Indonesia in 2014. and will increase its sales outlets from 100 to 130 during the year to meet its global business objectives.

“We are extremely pleased to launch our second plant and announce our participation in the LCGC initiative today,” said Toru Hasegawa, corporate vice president, Nissan Motor Corporation and president director, PT. Nissan Motor Indonesia. “With more production capacity and the LCGC license, we are able to further enhance our offerings to our Indonesian customers. Our investment is a reaffirmation of our deep and long-term commitment to Indonesia and our Indonesian customers.”

The Low Cost Green Car program by the Indonesian government exempts luxury tax on cars with engine capacity of up to 1,200 cc and with a minimum fuel consumption of 20 km/l. Tax exemption applies to diesel or semi-diesel vehicles of up to 1,500 cc with minimum fuel consumption of 20 km/l. At present tax for new vehicles ranges from 10-75% based on engine capacity.