Suzuki to invest $771m to build a new Indonesia car plant

TOKYO (REUTERS) - Suzuki Motor Corp is investing 60 billion yen (S$771 million) to build a new passenger car plant in Indonesia, a spokesman said on Sunday, as Japanese automakers target the world's fourth most populous state.

Japan's fourth biggest carmaker by sales volume is set to manufacture small cars in Indonesia based on its fuel-efficient 660 cc mini car "Wagon R" which is sold in Japan, spokesman Ei Mochizuki told Reuters.

In Indonesia, Suzuki will be exchanging the 660 cc engine for ones with a bigger displacement, Mochizuki added. He declined to disclose the plant's capacity or when it will start operating. Suzuki already has a car plant in the country.

Indonesia, where over a million cars were sold last year, recently signed into law a Low Cost Green Car (LCGC) programme to promote small cars, though it is on hold pending review.

Suzuki is among Japanese carmakers including Toyota Motor Corp and Honda Motor Co that are considering utilising their Japan-only mini car technology to build a presence in emerging markets with a fast growing middle class, like Indonesia.

Suzuki is known for its presence in India where it has been building cars since the early 1980s. Its subsidiary Maruti Suzuki India Ltd is the country's biggest carmaker by sales.