GM - Indonesia's Oldest Car Manufacturer To Quit In Q2, 2015

General Motors, the manufacturer that has been producing cars in Indonesia since 1938, has announced late yesterday that it will cease manufacturing cars at the company's Bekasi plant in June 2015.

Although the company will no longer be producing cars in Indonesia, its vehicle retail sales operations will continue as usual, relying exclusively on full-imported models, mostly from Thailand.

“GM Indonesia is undergoing a market-driven transformation,” said Stefan Jacoby, GM executive vice president and president, GM International. “This transformation will strengthen the business and dealer network by focusing on building the Chevrolet brand and delivering a competitive, high-quality portfolio to meet the needs of customers in Indonesia.”

GM also said that the decision to discontinue its manufacturing operations in Indonesia was driven by problems with high material costs and reduced potential to utilize the local supplier base due to limited scale.

The Bekasi plant has an annual production capacity of 40,000 units and currently produces the Chevrolet Spin for the Indonesia, Thailand and the Philippines market. The plant was opened in 1995 but was shut down in 2005, before GM reactivated it again in 2013.

Prior to the opening of the Bekasi plant, GM had another plant in Tanjung Priok, the first car plant in Indonesia.   

With the shuttering of the Bekasi plant, the next available source for the Spin will be Brazil, but given that they do not make right-hand drive versions of the Spin, it is safe to say that the Spin will be dropped from Chevrolet's line-up in ASEAN.

GM also announced that GM Indonesia's President, Michael Dunne, will be leaving the company to start his own business.

Prior to joining GM in 2013, Michael Dunne was the founder of Bangkok-based Automotive Resources Asia in 1993, an automotive industry consultancy which he later sold to J.D Power and Associates in 2006, before starting another consultancy based in Hong Kong, Dunne & Co. in 2010. He speaks fluent Thai and Chinese language, and has spent a large part of his career in China.

Dunne is also the author of American Wheels, Chinese Roads: The Story of General Motors in China.

In the interim, between Dunne's departure and the announcement of his replacement, the position of President of GM Indonesia will be handled by GM Indonesia's Chief Financial Officer, Pranav Bhatt.