Pirelli Invests in Indonesia

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PirelliPirelli has signed an agreement with Astra Otoparts, an Indonesian automotive components maker, for the construction of a new factory in Indonesia, Pirelli’s first in the country, for the production of conventional motorcycle tires.

The joint venture will see Pirelli holding the majority position (60%) nd Astra holding the remaining 40%. The joint venture will invest a total of $120 million between 2012 and 2014 for the construction of a new factory.

Construction of the new factory, located a short distance from Jakarta, is expected to begin in the fourth quarter of 2012. When completed (second half of 2013) it will employ 750 people.

The new facility will allow Pirelli to not only strengthen its motorcycle production capacity – which according to the forecasts of the industrial plan will grow to 16 million pieces in 2015 from 13 million pieces in 2011 – but also to have a direct presence in Asia’s largest economy, which with a circulating pool of 250 million motorcycles is the biggest motorcycle market in the world.

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