Honda Lowers City Car Sales Targets in Indonesia

09/26/96

Nikkei English News reports that Honda reduced sales targets for its City car in Indonesia. Starting next month, PT Timor Putra Nasional--a joint venture between Kia and Indonesian President Suharto's son--will begin selling the Timor, a national car. President Suharto has assured PT Timor Putra Nasional preferential customs treatment, guaranteeing a price of about 36 million rupiah (approx. $15,500) for the Timor Sedan with a 1,500 cc engine. The price subatantially undercuts the 56 million rupiahs Honda asks for its City car, which is a comparable model.

Honda had hoped to sell 6,000 City cars per month. Poorer-than- expected Japanese car sales just ahead of the Timor debut has forced Honda to lower its targets by 60%, to 2,400 units per month. Timor Putra has already logged 8,000 orders for the Timor, in anticipation of its introduction.

Honda plans to manufacture the City car in Malaysia, Pakistan, and the Philippines by year's end. It will begin in India next year. Honda hopes to bring Southeast Asian City car production up to 50,000 units per year, although that figure does not take the revised Indonesian sales target into account.

Paul Dever -- The Auto Channel