Gajah Tunggal Sales to Increase 20 per cent

Company director Catharina Widjaja told local news sources that the sales growth would continue into next year. In order to meet higher demand for its products, the company plans to invest as much as US$50 million to increase production capacity to 105,000 motorcycle tyres per day in 2009, from the present production capacity of 35,000 per day. Gajah Tunggal also plans to expand its car tyre production by investing US$100 million to boost the production capacity to 45,000 units per day in 2008 from its current level of 30,000 units per day. The company sold 600,000 units to Michelin this year, with sales likely to increase to 1.5 million units next year, in line with the expansion of the company. Gajah Tunggal’s increase is set against a general upturn in tyre sales.

The Association of Tire Producers of Indonesia, recently said that the domestic demand for tyres has grown by 10 –15 per cent per annum. Car sales are predicted to grow to between 510,000 and 530,000 units this year, after increasing by 36 per cent last year to 483,295 units. The Association of Automotive Producers of Indonesia (Gaikindo) predicts motorbike sales will grow similarly sharply, increasing 38 per cent to 3.89 million units this year. According to Bloomberg Indonesian tyre makers sold about 35 million units last year, including 10.6 million to domestic users.