02 December, 2020

Cruising Into Bigtime

A 'national car' challenges WTO rules and takes on global rivals

Cruising Into Bigtime
outlookindia.com
-0001-11-30T00:00:00+05:53

IT'S an issue that threatens to snowball into a sticky international row. The global trade order, as set forth in the rules of the World Trade Organisation (WTO), is being challenged by the Timor, Indonesia's controversial Korean-made 'national car'.

The Timor, launched in Jakarta on July 8 to strong consumer interest, is a joint venture owned 70 per cent by Hutumo 'Tommy' Mandela Putra, younger son of President Suharto, and 30 per cent by Kia Motors of South Korea. The cars are being manufactured in Korea by Indonesian workers till the firm commissions its factory in Indonesia. And the first batch of the sedan model will roll out in October.

For at least three years, the Timor will be able to undersell its mostly Japanese competitors because the joint venture, Kia-Timor Motors, has been granted exemption from tariffs and luxury taxes. Timor sedans, designed to appeal to young couples and families, will sell for about $15,000 each, half the cost of similar Japanese sedans whose makers must pay taxes. But critics claim the luxury...

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