Automotive Industry Growth Strengthens National Economy: Minister

President Jokowi, accompanied by Minister of Industry Agus Gumiwang Kartasasmita, attends the export ceremony of Toyota Fortuner to Australia, in Karawang, West Java, Tuesday (02/15). (Photo by: BPMI of Presidential Secretariat/Muchlis Jr)

The growth of automotive industry has brought a positive impact on manufacturing industry and the national economy, according to Minister of Industry Agus Gumiwang Kartasasmita.

“Automotive industry grew tremendously in 2021, reaching a double-digit growth of 17.82 percent. The absorption of workers was also relatively high, namely around 1.5 million workers in the industrial value chain,” the Minister said during a special ceremony to release export of Toyota Fortuner cars to Australia, in Karawang, West Java, Tuesday (02/15).

According to Agus, the national automotive industry consists of 21 companies with a production capacity of 2.35 million units per year.

“With a wide-spread value chain, the national automotive industry has a power linkage value of Rp 35 trillion and a backward linkage value of Rp 43 trillion in 2021. Toyota has a power linkage value of Rp 19.7 trillion and a backward linkage value of Rp 16.1 trillion, or almost 40 percent of the total capacity of  the manufacturing industry,” he said.

Agus went on to say that Ministry of Industry is committed to developing the industrial sector to increase investment, provide value added, and expand exports in line with the directives of President Joko “Jokowi” Widodo.

For the record, the export market share of Indonesian automotive products consists of more than 80 countries.

“Our export in 2021 comprised 294,000 units of CBU (completely built up) vehicles with a value of Rp 52.9 trillion. As for CKD (completely knocked down) vehicles, we produced 91,000 sets with a value of Rp 1.31 trillion,” he said.

On that occasion, the Minister also expressed his appreciation to car manufacturer PT Toyota Motor Manufacturing Indonesia that will make Indonesia an export hub for all its products.

“On behalf of the automotive industry manufacturers, we’d like to thank Mr. President for all the support and directives in supporting automotive industry amid the pandemic, especially through the Government-borne luxury tax (PPnBM) policy. The policy has proven effective in increasing vehicle production and preventing layoffs in the automotive sector, especially in small and medium industries,” the Minister remarked. (FID/UN) (RI/EP)