UNAIR NEWS – With a ratio of motor vehicle ownership that is still quite low at 87 vehicles per 1,000 people and World Bank’s prediction that the number of Indonesia’s middle class will reach 143 million people, or 50 percent of the total population of Indonesia, national automotive industry has the potential to develop in the future.
However, some challenges also need attention. Among these are changes in global trends. Currently, the world automotive industry is heading towards developing electric vehicles and autonomous vehicles. Furthermore, the world economy has been weak in recent years due to the US-China trade war. Some of these conditions contributed to the weakening of the investment value and sales of the automotive sector globally.
Discussing these opportunities and challenges, Airlangga Alumni Association (IKA) Faculty of Law Jabodetabek held a discussion themed “Indonesian Automotive Industry: Policies, Prospects and Development Challenges”. The discussion held on Tuesday, March 10, 2020 took place at the STR Building, Jakarta. The speakers were Eko Cahyanto (Head of the Industrial Human Resources Development Agency, Ministry of Industry); Andi Hartanto (PT Astra International Tbk.); Iman Prihandono (Head of the International Law Department, FH Universitas Airlangga). The moderator was Aru Armando (Head of Regional Office III Bandung, Business Competition Supervisory Commission).
According to Eko Cahyanto, the automotive sector is an important national industry whose contribution is significant to the national economy. Moreover, Indonesia has become a net-exporter for automotive products. This means that Indonesia has been able to compete globally in the automotive industry. However, the automotive industry needs to diversify its products, the market for sedan and SUV types is still wide open in Australia and Arab countries.
“The automotive industry currently accounts for at least 60 percent of the total national GDP,” he said.
Furthermore, Andi Hartanto stressed the importance of intellectual property rights (IPR) in the automotive industry. Almost all stages in the production process, components and final products in the industry are greatly influenced by the existence of IPR. According to Andi, the most important selling point in the automotive industry is its IPR.
“Therefore, the national automotive industry needs to be given incentives in order to continue to make new innovations,” he added.
As a representative of academics, Iman Prihandono observed at least three challenges in the national automotive industry, raising the level of domestic content (TKDN), increasing labor productivity index, and preparing environmentally friendly automotive products.
“Gradually motor vehicles need to switch to using renewable energy. This can significantly reduce gasoline imports and subsidies, “he explained.
Meanwhile, Head of IKA FH Universitas Airlangga Jabodetabek Didik Setyadi expressed his appreciation to all speakers and all alumni of Faculty of Law (FH) Universitas Airlangga who had participated. Didik hoped that the discussion can provide balanced input about the position of all stakeholders in the automotive industry, including workers, manufacturers (ATPM), and component suppliers (small and medium businesses).
“Universitas Airlangga alumni spread across many professions and ministries will certainly always be ready to provide input and support to the government to improve the national industry,” he concluded. (*)
Editor: Feri Fenoria
