Honda puts hybrid cars on hold (in Indonesia)

As Honda begins construction of a second factory in Indonesia on Monday, its executives say the giant Japanese carmaker has no immediate plans to produce hybrid cars in Indonesia even as the government pushes for fuel- and environmentally-friendly cars.

“It would be difficult to produce hybrid cars in Indonesia , as we need to invest in the technology first,” Honda Prospect Motor (HPM) marketing director Jonfis Fandy said at the ground-breaking ceremony for Honda’s newest plant in Karawang, east of Jakarta.

The Indonesian market was not ready for hybrid cars due to a lack of knowledge about the technology, he said, adding that work was needed to inform the public about how hybrid cars operated and how they could benefit from them.

For hybrid cars to truly contribute to Indonesia ’s energy conservation efforts, they had to be available in both the low and high ends of the market, he said. “How much [energy] can we realistically save if hybrid cars are only available for high-end users which make up 30 percent of the automobile market here?” he asked rhetorically.

Honda introduced the Honda Civic Hybrid in Indonesia in 2007 but pulled it off the market because of lack of interest. Honda is currently building a plant in Thailand to produce Jazz Hybrids and the first cars will roll out in 2013.

Industry Minister MS Hidayat said on Monday that he would call on all carmakers in Indonesia, including Toyota and Honda, to push them to start producing hybrid cars, detik.com reported. President Susilo Bambang Yudhoyono last month said the government planned to offer various incentives to carmakers to make them affordable.

Honda’s second factory in the Mitrakarawang Industrial Area has been earmarked to build the Brio at the lower end of Honda’s range. The plant will produce the hatchback version, which is already sold in India and Thailand, and the newer MPV model, which will be launched in 2014.

Honda’s operation in Indonesia is a joint venture between Honda Motor Co. of Japan and PT Prospect Motor of Indonesia. The original plant, opposite the new factory, produces Jazz, CR-V and Freed models. Once completed in 2014, the second plant will triple Honda’s production capacity in Indonesia to 180,000 cars per year from 60,000.

“Indonesia is an important market for Honda,” Takanobu Ito, the CEO of Honda Motor Co., said at the ground-breaking ceremony. “With a growing market and more conducive environment for economic growth, this country has a lot of potential.”

Ito said the Indonesian operation was one of Honda’s strongest both in terms of sales and production in the Asia-Oceania region and it topped sales among Southeast Asian markets last year.

Honda has chosen Indonesia as one of its production hubs in Asia, along with India and Thailand. It plans to use more materials from local suppliers, adding a further 45 local suppliers to its current 85.

The new factory will be built by construction company PT Takenaka Indonesia. (han)

Source;
http://www.thejakartapost.com/news/2012/06/05/honda-puts-hybrid-cars-hold.html