SGMW eyes Southeast Asian auto market for momentum

Automaker plans to expand presence, win more customers with vehicles of higher quality

Indonesian Mukty Pratama has been working in the local plant of carmaker Shanghai General Motors Wuling since May 2016. He had been with other leading international automakers, but this is his first time working in a Chinese-run company.

Confident that Wuling's quality is up to international standards, he always recommends the brand to family and friends, citing its good quality and competitive price.

"I am the one who is in charge of quality, so I know it the best," said Pratama, a supervisor at the Quality Operation Section.

Just recently, his aunt bought a Confero S multi-purpose vehicle, Wuling's best-selling model. "After trying it, she was very satisfied with the car," he said.

With 17,000 cars sold in 2018, SGMW brand Wuling Motors ranks ninth among automobile brands in the country, according to a list by Gaikindo, the Association of Indonesia Automotive Industries. Founded in 2016, SGMW Motor Indonesia has launched three models in the local market since it started operations two years ago.

Chen Weidong, vice-president of SGMW Indonesia, believes SGMW's modern, first overseas manufacturing facility will not only help promote Indonesia's economic development but also demonstrate the high quality of Chinese manufacturing by being on a par with international standards.

"What we want to do here is to provide Indonesian customers with more options by providing high-quality products while promoting healthy competition in the market," he said.

"In general, Wuling's market share in Indonesia is only around 2 percent," said Chen. "But we see this as a delightful achievement given that the competition in Indonesia's automotive market is fierce and mostly dominated by Japanese brands."

In the ranking compiled by Gaikindo, Wuling was the only non-Japanese brand among the top 10. Japanese cars make up more than 90 percent of the Indonesia automotive market, leaving only limited space for brands from the United States, Europe, South Korea and now China.

Chen said SGMW Indonesia's Almaz sport utility vehicle will be exported to Thailand this year under the General Motors brand Chevrolet.

During the first quarter, Almaz topped its market segment in terms of sales even though it was only launched in Indonesia in February.

"China has already risen as a major car manufacturing power and the largest automotive market in the world," Chen said. "But in terms of car exports, we have yet to achieve a global market share that matches these titles."

SGMW Indonesia now sells Wuling vehicles through 94 dealerships across the country and aims to have 120 in total. The Indonesian plant is also expected to be a SGMW manufacturing base for the whole Southeast Asian market.

Located in Cikarang town of Bekasi Regency, West Java, SGMW Indonesia's 60-hectare facility is the company's first plant outside of China. It comprises a 30-hectare main assembly plant and a 30-hectare suppliers' park. The $700 million facility was designed to reach an annual production capacity of 120,000 cars.

In 2015, SGMW became the first automaker in China with annual sales of over 2 million cars, according to China Auto News.

To further increase the impact of Chinese automobile brands among member states of the Association of Southeast Asian Nations, SGMW Indonesia initiated the China-ASEAN Automotive Standards and Regulations Research Center in April 2018, in cooperation with the China Automotive Technology and Research Center.

The latest dialogue held on May 13 in Bandung, Indonesia, saw representatives from China, Indonesia, Malaysia, Thailand, the Philippines, Cambodia and Laos.

"Through in-depth conversation, we hope to enhance mutual understanding (among the auto industries of different countries)," said Chen. "It is also a platform to promote regional cooperation in automotive standards and regulations."