Chevrolet models at the showroom at GM Korea's Bupyeong assembly plant near Seoul. (JG Photo/Heru Andriyanto)

GM Aims to Repeat South Korean Success in Indonesia


NOVEMBER 05, 2015

Bupyeong, South Korea. General Motors aims to revive its presence in the Indonesian market, but this time not by producing cars domestically. Instead, the US manufacturer will continue to ship cars from South Korea, home to one of its biggest and fully integrated design engineering and manufacturing operations.

“The world is fast becoming an open market for everyone. We need to change the course,” GM Korea vice president Marc Comeau said at a recent media visit by Indonesian reporters to the GM facility in Bupyeong, near Seoul.

The key for GM is to offer a wider range of choices for Indonesian customers, even after the carmaker shuttered its assembly plant on the outskirts of Jakarta earlier this year.

“It doesn’t matter whether you are in [South] Korea or Indonesia, customers need choices,” Comeau said, noting that for many years the only choices for South Korean motorists were Hyundai and KIA automobiles, until GM boosted its presence there.

In a country where Toyotas and Hondas barely register on the streets, GM has grabbed a 10 percent share of the market to become South Korea’s third-biggest car vendor.

Its Bupyeong plant is now at full capacity, churning out 60 cars an hour, working seven days a week.

“We cannot keep up with the math; if we have enough suppliers we can become the second-largest,” Comeau said.

GM also has three other plants in South Korea – at Gunsan, Changwon and Boryeong – with combined production capacity of more than a million cars a year.

Comeau said GM’s success story in South Korea could be replicated in Indonesia, but not anytime soon, given that total Indonesian car sales were still only just over a million units a year.

What GM needs to do in Indonesia is apply the same strategy that has served it well in South Korea, namely getting customers know the product well before making a decision, Comeau said.

“It’s the same situation here and very interesting – 48 percent of people buy cars without testing them, because there isn’t much choice,” he said.

“We win our customers by making our vehicles more accessible; we provide 2,000 test vehicles for them. Our cars are well engineered, they try them and they like them.”

A more regional approach will work better in Indonesia, especially under regional free trade agreements that should allow GM to operate more aggressively to increase its portfolio from other countries, Comeau said, adding that GM now had 171 manufacturing facilities and 212,000 employees in 120 countries across the globe.

Gaurav Gupta, the GM Indonesia president director, said the company was stepping up efforts to improve after-sales services to boost customers’ confidence in the Chevrolet brand, the only GM range currently sold in Indonesia.

Gupta said that extensive surveys had found that “a lot of customers aren’t satisfied with a lot of brands.”

“We are working to meet customers’ expectations through the Chevrolet complete care program. We offer a three-year warranty, as well as 24-hour customer assistance center and emergency roadside assistance,” he said.