Tata Nano Expands to Indonesia
Why Indonesia?
a. Market summary
It is well known that with the global crisis and down-play in economics, the Indonesia automobile industry still remains a vigorous expansion rate. Indonesia has become a new emerging prosperous car market in the world. According to The Economist (2012), Indonesia's market is even increasing more rapidly than Chinese and its sales boosted approximate 900, 000 new vehicles from 2010 to 2011, by 17%. What is more, the sales volume of Indonesians automobile had overtaken Thailand in 2011, now the largest market in south-east Asian nations (The Economist, 2012). For 2012 first half year’s sales, ‘Car sales rose to 534,876 units in the first six months compared to 417,672 in first half of 2011 and according to Joko 2012’s sales could reach 920,000 to 950,000 units’ (JakartaGlobe,2012).
b. Reasons lead to the boom industry
The phenomenon of Indonesia automobile industry’s flourishing development results from a lot of combined social reasons. Firstly, the population of Indonesia is huge, ranked 4th in the world population and According to the national census (2010), the population of Indonesia is 237.6 million, with high population growth at 1.9% (WASPADA ONLINE, 2011). Then, the population growth accompanied with Indonesia’s economy dizzying ascent rose by 6.5% 2011 and it is optimistic that it will maintain its GDP growth percentage (Farida, 2012; Andreas, 2012). What is more important is that ‘Despite record sales, only 4% of the population has a car, a relatively low figure (see Figure)’ (The Economist, 2012).Finally, the labour force in Indonesia is cheap and wholly-owned foreign subsidiaries in Indonesia is permitted by the government (Foreign Capital investment Law No.1, 1967). In conclusion, since the huge population base, low car-owning percent, dramatically increasing income and cheap labour, the automobile industry in Indonesia is promising. Indonesia has become a new competing market for vehicle brands all over
a. Market summary
It is well known that with the global crisis and down-play in economics, the Indonesia automobile industry still remains a vigorous expansion rate. Indonesia has become a new emerging prosperous car market in the world. According to The Economist (2012), Indonesia's market is even increasing more rapidly than Chinese and its sales boosted approximate 900, 000 new vehicles from 2010 to 2011, by 17%. What is more, the sales volume of Indonesians automobile had overtaken Thailand in 2011, now the largest market in south-east Asian nations (The Economist, 2012). For 2012 first half year’s sales, ‘Car sales rose to 534,876 units in the first six months compared to 417,672 in first half of 2011 and according to Joko 2012’s sales could reach 920,000 to 950,000 units’ (JakartaGlobe,2012).
b. Reasons lead to the boom industry
The phenomenon of Indonesia automobile industry’s flourishing development results from a lot of combined social reasons. Firstly, the population of Indonesia is huge, ranked 4th in the world population and According to the national census (2010), the population of Indonesia is 237.6 million, with high population growth at 1.9% (WASPADA ONLINE, 2011). Then, the population growth accompanied with Indonesia’s economy dizzying ascent rose by 6.5% 2011 and it is optimistic that it will maintain its GDP growth percentage (Farida, 2012; Andreas, 2012). What is more important is that ‘Despite record sales, only 4% of the population has a car, a relatively low figure (see Figure)’ (The Economist, 2012).Finally, the labour force in Indonesia is cheap and wholly-owned foreign subsidiaries in Indonesia is permitted by the government (Foreign Capital investment Law No.1, 1967). In conclusion, since the huge population base, low car-owning percent, dramatically increasing income and cheap labour, the automobile industry in Indonesia is promising. Indonesia has become a new competing market for vehicle brands all over