Economy & Industry News

More Source of Steel Supply for Indonesia’s Car Industry

bajaJAKARTA- PT JFE Steel Galvanizing Indonesia is ready to supply steel for car industry in Indonesia. The steel mill has completed the construction of its plant in Bekasi (West Java) which will be officially opened on 15 September 2016.

“We’ve been operating, but not yet commercially available. Later roughly commercial in October for customers carmakers in Indonesia, especially for Japanese cars,” said General Manager of JFE Steel Galvanizing Indonesia, Mr Musfir, in Jakarta, Tuesday, July 26, 2016.

He said Indonesia still imports steel from Japan. Specifications of steel for cars are complicated. “Customers are very strict on specification, that’s why we cannot yet supply from local steel mills. Hopefully there will be companies that can supply these materials, ” he said.

When the material with the same specifications already exist in Indonesia, JFE will take the material from local companies because it is believed to be cheaper in the logistic costs. “We plan to supply Daihatsu, Toyota, Suzuki, Mitsubishi, and Nissan. Still limited to Japanese cars,” he said.

Director General of Metal, Machinery, Transportation Equipment, and Electronic Industry Ministry, Mr I Gusti Putu Suryawirawan said, JFE factory will produce steel for car bodies that so far have been imported.

“With the JFE at hand, and later Cilegon Krakatau Nippon teel mill that also operates, imports are expected to be replaced,” he said.

President Director of PT Toyota Motor Manufacture Indonesia Me Masahiro Nonami said car industry still needs to import some materials, such as resins, synthetic rubber, and steel.

The plant attracted USD 300 million (around Rp 3.94 trillion investment, with referring to the Jakarta Interbank rate issued by Bank Indonesia on Tuesday). Mr Musfir targets production capacity to reach 400,000 tons per year. Production until the end of 2016 is estimated at around 20,000 tonnes.

Indonesia produces about 1 million per year with 600 kilograms of steel needs per car. Steel consumption of the plant will increase the local content of cars produced by the plants in Indonesia. “We supply directly from Bekasi,” he said. (Kompas)