ANALYSIS: Indonesia
based AGC Group, has been going ahead with expansions of core products, float glass and safety glass including automotive glass, to grab more market shares, depending on brighter outlook of the coming years. Parallel to the slowed economic performance in Indonesia, AMFG expects its business will still grow in line with the rapid growth of the middle-class’ productivity. The young middle class in society with ever increasing income has a high need to own property and automotive products, the company observed. Its float and processed safety glass have been contributing tremendously to the growth of property sector in Indonesia, it believes. This has made it courageous to go with implementation of its new float plant in Cikampek with a production capacity of 210,000 tons a year. It is being built at about 85 km east-southeast of the Jakarta plant, to expand markets of float and processed glasses in Indonesia and other emerging economies. The new furnace is being constructed adjacent to Asahimas’ existing and major safety and automotive glass fabrication plant in Cikampek. AMFG’s existing two producing float glass plants are located in Jakarta and Sidoarjo, near Surabaya, where safety glasses are also produced. The Jakarta location is now under severe pressure of rapid urbanization and the Indonesia government’s development plans for improving the city’s living atmosphere, for which the company needs a better factory environment and more opportunities for smooth expansion considering Indonesia’s future demand. Currently Asahimas has a production capacity of 570,000 tons of float glass, 4.5 million sq meters of safety glass and 2.4 million sq metres of glass mirrors. After construction of the new furnace in Cikampek in the third quarter of 2016, the production capacity of float glass will initially increase to 630,000 tons a year. Demand for architectural glass and automotive glass in Indonesia is expected to keep growing against the backdrop of the country’s steady economic growth. The construction of a new furnace is intended to achieve a competitive production framework to meet the growing demand in the region, the AGC Group observed. AMFG’s flat glass products are used partly as glass application on buildings, interiors and as raw materials for further processed glass and automotive glass. It produced about 52,000 tons of automotive glasses in 2014 and has a growing demand, because of expansion of automobile productions in Indonesia and other regional countries.
PT Multi Arthamas Glass Industry (MAGI) Location: Surabaya, Propinsi Jawa Timur, Indonesia Products: Processed safety glass. Markets: Domestic and export markets Others: Multi Arthamas produces tempered, laminated and bending glasses for automotive, building and industrial uses. PT Tossa Shakti Group Location: Raya Semarang-Kendal KM 19, 5, Kendal, Indonesia Products: Float, figured/pattered and processed glasses. Markets: Domestic and export markets Others: Tossa Shakti group has 2 manufacturing factories, PT Tossa Shakti Float Glass for float, and PT Tossa Shakti Figured Glass for figured/patterned glass, with daily production capacity of 900 tons and 70 tons, respectively. PT Abdi Rakyat Bakti Location: Sei Rengas I, Medan Area, Medan 20214, Sumatera Utara, Indonesia Products: Sheet glass and processed glasses. Markets: Domestic and export markets. Others: Abdi Pakyat Bakti markets its float and processed glasses in Indonesia and neighbouring countries. Tunggal Majuasri Glass PT Location: Kawasan Industri Benua Indah, Tangerang 15131, Banten, Indonesia Products: Flat and processed glasses. Markets: Domestic and export markets. PT Tensindo Location: Nolokerto Kendal 51372, Kaliwungu, Semarang, Jawa Tengah, Indonesia Products: Flat and processed glasses. Markets: Domestic and export markets SRK building glass: Photocredit SRK
Changing lifestyles
Indonesia’s increasing middle class population is aspiring to move towards a more upper scale of lifestyles. The newly entrant mid-level middleincome consumers are spending on owning new cars. This has prompted automotive glass manufacturers like AGC and Compagnie de Saint-Gobain to plan for new investments to respond the growth of the local automobile assembling plants in the coming years when Indonesia is expected to expand export sales of cars and other commercial vehicles. A joint effort of France based Saint-Gobain and Japan’s third largest flat glass manufacturer Central Glass Co Ltd is poised to tap the growth of the Indonesian economy and its growing automobile manufacturing. By entering a 50:50 joint venture, the two companies have founded an automotive glass manufacturing company, PT Central Saint-Gobain Sekurit Indonesia, to produce and sell automobile glass in Indonesia. The work of the project was in progress till the third quarter of last year when it delayed completion of the project following current slump in demand of cars. To make the joint-venture successful in responding to the rapid growth of the Indonesian automotive market in the past years, both the partners have started efforts to install a latest and highly efficient automobile glass plant capable of producing laminated automotive glasses for
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SRK glass in Singapore: Photocredit SRK
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