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Tata Motors to foray into Indonesia


Commercial vehicles major Tata Motors announced its entry into Indonesia, the largest automobile market in the ASEAN region on Tuesday. The company has set up a wholly owned Jakarta-based subsidiary, PT Tata Motors Indonesia, and will foray into both passenger and commercial vehicles.

The company will begin to launch its products in 2013, for which extensive preparations are now on.

By the time of the launch, PT Tata Motors Indonesia will have about 10 to 15 dealers nationwide, offering sales, service and spare parts. Over a period of three years, the company will set up a country-wide network of about 60 full-service dealers, about 100 other workshops and about 300 more spare parts retailers.

Indonesia is the biggest market for automobiles after China and India. Currently, Tata Motors is present in Thailand and Korea.

Analysts say the company has not had much success abroad so far, so it is too early to upgrade earnings per share for the Indian entity.

Shares in the company closed flat, up 0.3 per cent at Rs 249.60 on the BSE, outperforming the BSE auto index, which ended flat with a negative bias.

The company is also evaluating options for setting up a manufacturing base in Indonesia to serve the country and the ASEAN region. Significant investments will also be planned for component localisation.

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