GM confirms Indonesia factory plan with China's SAIC Motor

[SHANGHAI] General Motors said on Monday that one of its Chinese ventures plans to establish manufacturing operations in Indonesia to take advantage of growth in Southeast Asia's biggest vehicle market.

Confirming a Reuters report published on Saturday, the US carmaker said SAIC-GM-Wuling (SGMW), a joint venture between GM China, SAIC Motor Corp Ltd and Wuling Motors, is planning to establish a manufacturing facility near Jakarta to build Wuling brand vehicles.

Construction of the facility is planned to begin this year, subject to government approval, GM said in a statement posted on its website.

The vehicles will be sold primarily in Indonesia, with plans to potentially export them to other regional markets, it said.

Sources told Reuters that GM and SAIC would make a joint push into Indonesia, using their no-frills Wuling brand to establish a beachhead in Southeast Asia's biggest market and from there tackle other markets in the region.

In a report late on Friday, officials from Indonesia's industry ministry told state Antara news agency that GM and SAIC would invest US$700 million in Indonesia to build vehicles.

The GM statement did not provide the size of the planned investment.

An official at Wuling confirmed the venture's plan to build a factory in Indonesia. SAIC could not be reached for comment.

REUTERS