TOKYO: Suzuki Motor Corp said on Wednesday it would spend 60 billion yen ($780 million) to build more engines and cars in Indonesia as it seeks growth in the fast-expanding market dominated by the Toyota Motor Corp group.
Japan's No.4 automaker said it bought 1.3 million square metres of land in an industrial park to the east of Jakarta for 10 billion yen ($130 million). The land will first be used to build a 100,000-units-a-year engine plant for 30 billion yen to reduce imports of the expensive component.
Suzuki will spend another 20 billion yen to further raise the ratio of locally produced components and for the planned expansion of output capacity by 20,000 cars to 100,000 a year this spring, when it is due to launch a new model in the seven-seater segment popular in Indonesia.
Suzuki currently has two factories in Indonesia that can build 1 million motorcycles and 80,000 cars a year. It said the newly purchased land could also be used to make more vehicles as the market grows.
In 2010, Suzuki was the fourth-biggest brand in Indonesia, where Toyota and its minivehicle unit Daihatsu Motor Co together make up more than half the market.
Suzuki's shares were up 2.5 percent on Wednesday morning amid a broad rise in car stocks.
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