Honda in further motorcycle investment for Indonesia


Indonesian market leader Honda Motor (Tokyo) has unveiled plans for the construction of a fourth assembly operation for motorcycles in the booming Southeast Asian market of Indonesia, where units sales topped 8 million last year. With the typical motorcycle utilizing several kg of both PP and ABS, and some HDPE to boot, the latest investment is good news for local processors.

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Greenfield site for Honda's new Indonesian bike plant.

Local affiliate PT Astra Honda Motor's (AHJ, Jakarta) fourth motorcycle plant will produces scooter models exclusively with 1,100,000 units production capacity per annum. Scooters typically employ double the volume of plastic compared with conventional low cc-rating motorcycles. The new plant will boost Honda's capacity in Indonesia to 5,300,000 units in total.

This plant, which will be built in the Bukit Indah Industrial Park about 70 kilometers east of central of Jakarta, and operation is scheduled to start in the autumn of 2013. Honda's investment in the plant is valued at around $334 million. The new facility will employ the renewable power sources of wind turbines and solar for part of its energy needs. Automation will also feature prominently in the plant.

The motorcycle market of Indonesia is the world's third-biggest market next to China and India. Overall, a record 8.01 million units were shipped in 2011, representing 9% growth. For its part, AHJ sold 4.27 million units and increased its market share in doing so. For 2012, the overall Indonesian market is expected to be reach approximately 8.7 million units and AHJ is planning to sell around 4.8 million units. Honda's motorcycle production capacity in the Asia Pacific region currently stands at 11.5 million units.-mpweditorial@ubm.com

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