KONTAN.CO.ID - JAKARTA. PT Astra Daihatsu Motor, a unit of Indonesian conglomerate Astra International and Japan's Daihatsu, started construction of its new car assembly plant in Indonesia on Thursday, it said in a statement.

The new plant, which will require a total investment of around 2.9 trillion rupiah ($195 million), will be located in East Karawang, West Java province with an expected annual production capacity of 140,000 cars.

The company is aiming for construction of the plant to be completed by December 2024, although no date has been specified for production to commence.

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The company's executive director Yasushi Kyoda said the investment shows a commitment to further cooperation with Indonesia, adding that the new facility, based on renewable energy concepts, could reduce carbon emissions by up to a fifth.

Doddy Widodo, an official at Indonesia's industry ministry, welcomed Astra Daihatsu's expansion. "It shows incentives given by the Indonesia government, especially for the automotive industry, are being well implemented," he said.

The plant will replace Astra Daihatsu's old factory which is located in Jakarta and be the second in Karawang, following the construction of a first plant there in 2011.

Editor: Yudho Winarto