INAPA Jakarta – Gateway to ASEAN auto parts market

By T Murrali 

Indonesia is the third largest consumers of motor vehicles in the developing countries after China and India. With over 20 million cars and 50 million scooters it is the major market in the ASEAN region.

Vehicle growth is considered as a vital component of industrial development in Indonesia.  The country is the production base of several global automobile companies and the entry point to the ASEAN market. It is also the centre of global trade exhibitions and conferences.  One of the very successful trade shows, INAPA Jakarta, is organised by PT Global Expo Management Indonesia, shortly called as GEM Indonesia.

3The recently concluded INAPA Jakarta 2015 – the 7th Indonesia International Auto Parts, Accessories and Equip Exhibition – had over 1,000 participants from 18 countries in addition to Indonesia. It attracted more than 30 percent more visitors than in the previous edition.

The event is an annual gathering and the market place for international manufacturers and suppliers of auto components/parts, equipment, tools, and technology.

Speaking to AutoParts Asia, Baki Lee, Director, PT Gem Indonesia, said that the first show had about 3,000 visitors, while the second grew to 6,000 visitors and the third edition witnessed about 16,000 visitors.

The number of international exhibitors also are growing with about 70 percent growth for the 2015 edition. However, visitors from overseas destinations are only about five percent. “We are trying to attract more international buyers,” he said.

5INAPA had about 20 percent CAGR since its start.  About half of the segments that participate in the show grow by 50 percent. Every edition brings in some change in the product portfolio. The recently concluded edition had more product mix; there was a dedicated section for bi-cycles, auto components, tyres and other related parts- everything clustered to facilitate the visitors.

INAPA is the one-stop shop for the automotive components industry.  It has emerged as a leading automotive parts show in ASEAN region because the event has five concurrent and independent expositions: Tyre & Rubber Indonesia 2015, INABIKE, IIBT, Con-Mine and Forklift Indonesia.

“Not that the entire show is concentrated on the automotive industry alone; we have decided to have every section reflect the name it stands for,” Lee said.

Organising shows within show is primarily to enable visitors to choose and spend more time at the booths of exhibitions of their interest as they would want to meet the target suppliers. PT GEM Indonesia is planning to include more sections focussing of allied segments of the auto industry.

There were 11 companies from India in the expo. They included India Transport Portal, Luthra Industrial Corporation, Superking Manufacturer, Supra Industries and Synthesis Winding Technologies.

6China had the largest contingent with more than 290 companies while the host country Indonesia had 125 exhibitors. However, the large tyre manufacturing companies from the country were missing. According to sources some companies had certain issues with Indonesia’s competitor association, on pricing. The government has fined them as they were controlling the price. Though this is happening everywhere in the world in Indonesia it was severe as the government has been treating this issue stringently, sources said.

Indonesia has a population of about 240 million. Though Thailand’s population is lesser, the vehicle production volumes are higher. For a consumption level of about 60 percent in Indonesia, Thailand has thrice the number of component manufacturers. However, the aftermarket is huge in Indonesia, Lee said. This has been the driving force for the visitors to the show, sources added.

Lesser participation from India was a matter of concern for PT GEM Indonesia. Lee said the company is looking at several options to enhance participation by arrangements with media houses to promote the event in India.

Lee hopes that the next edition in 2016 will see more exhibitors coming in as “we plan to position it considering other shows to be held in other markets. For the 2015 edition at least 60 clients declined to join us due to an event held in Singapore,” he said.


 

 Shows within Show – the PT GEM strategy

7In an exclusive interaction with AutoParts Asia, Baki Lee – Director, PT Gem Indonesia, explained the various strategic initiatives the company has taken to promote trade shows in Indonesia.

 Q: What is the strategy behind having independent exhibitions under different names?

Lee: This is basically our plan for the future. As we work with many clients they are used to see segmentation based on parts category. We are offering this facility based on the segments such parts for two wheelers, cars and commercial vehicles. I think this is easy for the visitors as they can choose to spend more time at the booths of exhibitions of their interest. The visitors would want to meet the target suppliers and the segmentation will enable the visitors to come back to the show in future.

Q: Which are the other segments that you are planning to organise dedicated exhibitions for?

Lee: Next year we will have separate sections for ‘Audio’ and ‘Modifications’ for vehicles. This is because the aftermarket potential in Indonesia is huge.

Q: The current show had only display and there were no demonstrations that is typical of trade shows – why?

Lee: Yes; there were only products displayed and no demonstrations held. We are planning to go step by step. We have reached a level of strong position, as a leader in the Southeast Asian region. We want to showcase products and demonstrations in future editions. Currently our expo is targeting only businessmen like sellers, resellers, distributors and others. By getting into new initiatives, including organising demonstrations etc. for the visitors, we will try to enable them to enhance the skill levels. Currently the show is focusing more on aftermarket.

Q: Why participation from India is less than that from other countries?

Lee: I think the focus of Indian companies are OEMs and getting into this segment in Indonesia is difficult due to the large presence of Japanese manufacturers. I know it is difficult for the OEM segment as Indonesia has very few vehicle manufacturers. Recently Isuzu and Mitsubishi had opened their new manufacturing facilities as they wanted to increase capacities by about 30 percent.

When it comes to auto components manufacturing, Indonesia has about 300 companies operating in this space. Even in this over 80 percent of them are Japanese. This is also a major concern of the Indonesian government as it wants to increase car production up to 2.5 million by 2016. In 2014 the production was about 1.3 million.

Indonesia has a population of about 240 million. Though Thailand’s population is less, the vehicle production volumes are higher. For a consumption level of about 60 percent in Indonesia, Thailand has thrice the numbers of component manufacturers. However, the aftermarket is huge in Indonesia. India can look at it.

Q: Automechanika is the largest show for aftermarket and participation from India is high in quite a few editions?

Lee: Yes I agree. India is very strong in tyres and therefore, the participation from tyre companies in India is high in INAPA. Here the focus is aftermarket.

 Q: How are you planning to promote the brand INAPA in India?

Lee: We hope to associate with partner companies to build the brand. We are also trying to meet with ACMA for partnership. We are also talking to Indian Embassy here.

Q: Is there a particular reason for you to look at India for participation?

Lee: Yes of course; the Indian auto component manufacturers are very good in terms of quality, when compared with other mass markets. Currently about 90 percent of automotive aftermarket products are dominated by Chinese parts. I think Indian companies must utilise this opportunity.

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