Japanese suppliers in ASEAN countries: Indonesia continues to expand

Activities in Vietnam, Malaysia, The Philippines, Laos, Cambodia and Myanmar also discussed

2013/11/27

Summary
Indonesia: establishment of new production bases
Indonesia: strengthening business and introduction of new products
Vietnam: establishment of new hubs and expansion of existing plants
Malaysia/Singapore/The Phillippines/Laos/Cambodia/Myanmar

Summary

The following report is an update of activities of the Japanese suppliers in ASEAN countries, covering the ten-month period up to the end of October 2013. (Activities of Japanese suppliers in Thailand will be provided in a different report.)

The automobile sales volume (new vehicle registrations) in Indonesia continued to expand with 1.08 million units for 2012, an increase of 24.3% year-over-year (y/y), and 989,000 units during the January to October 2013 period (10.8% y/y increase). Japanese automakers such as Toyota, Nissan, Honda, and Daihatsu are increasing their production capabilities in Indonesia. Japanese suppliers have followed the OEMs and have been expanding their production capacities. Other activities include the conversion of joint ventures (JVs) into wholly-owned subsidiaries, the increase of investment and production items, the introduction of integrated production system to meet customer needs more flexibly, and the positioning of Indonesia as an export hub.

Activities of Japanese suppliers in Indonesia

New entries	* Supply to automakers: Aichi Machine (MTs), NHK Spring (seats) for Nissan and Datsun, Asahi Forge (final gears for Honda; also exporting), Metalart (engine components for Daihatsu), F-Tech (suspension components), Kodama Chemical (interior/exterior parts), Yamashita Rubber (vibration insulating rubber), TDF (front axles for trucks) * Supply to Tier 1 suppliers: Asahi Kasei Chemicals (resin compounds; converted export from Thailand to local production under contract), Sunrise Industry (hose mouth rings for car A/Cs; converted export from Malaysia to local production), Nagoya Precision Mold (resin molds for lamps; converted export from Vietnam to local production) * Positioning of Indonesia as export hubs: H-One (dies for frame components), Nishikawa Rubber (automobile rubber and plastic products), Tatsumi (electric and brake components)
Enhancement of production capacities	* Construction of second plants: Akashi Kikai (MTs), Toyota Industries (compressors for A/Cs; also exporting to India and Brazil), Kasai Kogyo (door trims), JFE Shoji (steel material processing) * New/additional line and plant expansion: Aisan Industry (throttle bodies; also exporting to neighboring countries), Denso (spark plugs), Toyoda Gosei (airbags), Yutaka Giken (exhaust parts) * Addition of new items: JFE Steel (established a new company for producing hot-dip galvanized steel sheets), Nissin Kogyo (brakes for automobiles), Press Kogyo (frames for medium- and heavy-duty trucks; also exporting to Southeast Asian countries) * Establishment of integrated production system: TS-Tech (established a new seat assembly plant), Toyota Auto Body (started in-house production of large plastic parts), Univance (gears; established a forging plant and a new building for transfer cases; also exporting to China)
Conversion into subsidiaries/additional investments/acquisitions	* G-Tekt (converted a joint venture into a wholly-owned subsidiary), Nippon Piston Ring and TPR (dissolved their joint venture into separate businesses), Tachi-S (established a seat assembly plant through additional investment), Toyoda Gosei (increased its investment ratio for a sealing production joint venture), Toyota Tsusho (invested on a local leading supplier), Kuroda Electric (acquired a local automotive supplier)

Sources:Press releases by each company

Related Reports:
* Russia and Eastern Europe (Oct. 2013)
* India (Sep. 2013)
* Northern/Northeastern/Southwestern China (Aug. 2013)
* Southern and Central China (Aug. 2013)
* Eastern China (Jul. 2013)
* the US (Jul. 2013)
* Mexico and Brazil (Jun. 2013)
* Thailand (Apr. 2013)
* South East Asia (Mar. 2013)

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