Esemka Eyes Launch of Cheaper Pickup in August to Challenge Japanese Producers


MAY 06, 2016

Jakarta. Indonesian automaker Adiperkasa Citra Esemka Hero is confident that it will be ready to start marketing its locally produced pickup in August, which will be a cheaper alternative for local businesses that have long depended on Japanese brands.

Adiperkasa Citra Esemka Hero (ACEH) is a joint venture between Adiperkasa Citra Lestari, a company controlled by former State Intelligence Agency (BIN) chief Abdullah Mahmud Hendropriyono, and Solo Manufaktur Kreasi, the manufacturer behind the locally designed Esemka car, which made headlines a few years ago for being assembled by high-school students. The car was also endorsed by President Joko Widodo while he was still the mayor of Solo, East Java.

ACEH managing director Hosea Sanjaya said the company aims to sell the cheapest model Esemka pickup at below Rp 100 million ($7,500), compared with competitors' products that sell for Rp 130 million.

The local automaker plans to dispense with a distribution chain as part of its strategy to offer its products at a lower price, Hosea said.

"For example, we will sell directly to customers, without having to set up distribution centers or dealer networks," he said.

The company will also cooperate with existing original equipment manufacturers to supply standardized spare parts for the vehicles, further reducing development costs, Hosea said.

Adiperkasa Citra Lestari last year signed a cooperation agreement with Malaysian automaker Proton for the development of an Indonesian-made vehicle.

Esemka pickups will be available in two models, with an engine capacity of 1,000 cubic centimeters and 2,000 cc, respectively.

The company has set up an assembly plant at Cileungsi in Bogor, West Java, which has an annual production capacity of 30,000 vehicles.

More than 39,000 pickups have been sold in the first three months this year, accounting for 15 percent of the overall national car-sales figure, according to data from the Indonesia Car Manufacturers Association (Gaikindo).

Japanese brands such as Suzuki and Daihatsu remain forces to be reckoned with in the segment, with Mitsubishi and India's Tata following far behind.