The Indonesian government provides a series of facilities to automotive companies that have a certain level of Domestic Component Level (TKDN).
Meanwhile, on the other hand, small and medium industries (IKM) in the automotive sector that want to distribute their products do not yet have a guarantee of getting a place in the market. Or in other words, it hasn’t gotten a big container yet.
In fact, for the large automotive industry, partnerships with SMEs are able to support efforts to increase the TKDN of the products produced.
Quoted from the Antara news agency, the Ministry of Industry (Kemenperin) emphasized the importance of large automotive industries partnering with domestic small and medium industries (IKM).
One of the goals is to create opportunities for SMEs to enter the national automotive industry supply chain.
Illustration of a car factory, involving components from IKM [Antara] This activity provides an opportunity for IKM to dig up information about market potential and collaborations that can be explored with APM suppliers and large industries.
“For the large automotive industry, partnerships with IKM are able to support efforts to increase the Domestic Component Level (TKDN) of products produced,” explained Reni Yanita, Director General of Small, Medium and Miscellaneous Industries (IKMA) of the Ministry of Industry in Jakarta, this week ( 11/29/2023).
The partnership strategy between IKM and Tier APM in the automotive industry in practice has the potential to encourage IKM independence. Namely through market certainty, technology transfer, improving quality and quantity, management systems, improving human resources, and easy access to financing.
On the other hand, APM suppliers can obtain information about the potential of SMEs that can be made part of the supply chain.
Meanwhile, the Government has the opportunity to obtain input regarding the need for SME development that can be carried out in the future.
“This can encourage the large automotive industry to increase production capacity and create opportunities for SMEs to enter the national automotive industry supply chain,” continued Reni Yanita.
With market potential, the supply chain ecosystem for the domestic automotive industry needs to be strengthened, including through partnerships between large industries and domestic small and medium industries as carried out by the Ministry of Industry through the Coordination Forum for Transport Equipment IKM Partnerships with Large Industries.
In the Coordination Forum for Transportation Equipment IKM Partnerships with Large Industries held by the Ministry of Industry in collaboration with Astra through the Dharma Bhakti Astra Foundation (YDBA), PT Astra Daihatsu Motor, PT Kayaba Indonesia, and PT Patria Maritim Perkasa, a series of activities were held in the Link and Coordination Forum Match. An annual routine agenda of the Directorate General of IKMA which has been held since 2017.
This event is filled with various activities such as workshops, handing over certificates of facilitation by the Directorate General of IKMA, business meetings, signing Collaboration Commitments and handing over award plaques to transportation equipment industry players.
From data from Gaikindo and AISI in January-October 2023, the number of domestic sales of four-wheeled vehicles or more has reached 836,048 units and total domestic sales of two-wheeled vehicles is 5,237,976 units. This condition reflects the prospects for the automotive industry which are still promising this year and next year.
“Last year’s implementation, the Link and Match Coordination Forum activities resulted in an MoU between 16 Tier APMs and 32 IKMs which recorded a potential turnover value of IDR 105.2 billion,” said Reni Yanita.
He added that commitment and cooperation from all parties is needed so that domestic industry, especially SMEs, can play a role in providing quality and competitive automotive components.
