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T Kawasaki Motor Indonesia (KMI), a subsidiary of Japan'€™s motorbike maker Kawasaki Motors Corp., has begun operations at its new Rp 1 trillion (US$88.58 million) plant in a bid to harness growth in the domestic as well as overseas markets.

The new plant, which is located in West Cikarang, Bekasi, West Java, is Kawasaki'€™s third-biggest plant after its facilities in Japan and Thailand. It will have a total output of 150,000 big bikes per year, according to KMI president director Yoshihiro Tanigawa.

The output will be able to accommodate overseas demand with exports expected to increase significantly to 15,000 units this year from 2,000 units last year, according to Tanigawa.

KMI delivers motorbikes to Thailand and the Philippines but it is eying other destinations, including Japan and the United States.

'€œOur main market is still Indonesia, but Kawasaki also targets buyers in other developing countries,'€ Tanigawa said at the opening ceremony attended by Industry Minister MS Hidayat and Trade Minister
Muhammad Lutfi.

'€œWe'€™ve also challenged ourselves to rise to a new level by improving the quality of our products so that we can export Indonesian-made motorbikes to advanced nations,'€ he added.

The new plant will help Kawasaki meet the rising demand for premium motorbikes in Indonesia driven by the emerging middle class.

Indonesia is now the world'€™s third-biggest motorbike-producing country after China and India.

Domestic production amounted to 7.78 million units last year, up 9.9 percent from 2012. Sales stood at 7.74 million units, 9.62 percent up from a year earlier.

Kawasaki'€™s new plant will host a range of production activities, from the making of chassis and painting in the initial phase, to production of engines at a later stage.

Four models will be produced there, namely the Ninja RR Mono, KLX150S, KLX150L and D-Tracker150, according to Tanigawa.

The Cikarang plant is the second Kawasaki facility in Indonesia. Its first plant in Pulogadung, East Jakarta, has a production capacity of around 100,000 units.

Set up in 1994, the local unit of Kawasaki commenced production and sales a year later. In 1996 it started production of the Ninja model which became a favorite in the domestic market.

In 2008, Kawasaki again produced another hit with the introduction of the Ninja 250R on to the market.

Since then, the firm has met surging local demand through combined completely knocked-down (CKD) units made locally and imported completely built-up (CBU) units.

Kawasaki Deputy Head of Marketing Yusuke Shimada said the firm expected to sell approximately 200,000 motorbikes nationwide this year, more than double last year'€™s sales of 95,108 motorbikes, which represents nearly 2 percent of national sales.

'€œTo achieve that target, we'€™ve rolled out four models, and there will be another four models for issuance this year,'€ he said.

Exports of motorbikes from Indonesia dropped by 64.82 percent to 27,135 units last year, partly due to decreased demand caused by the economic slowdown, according to the Indonesian Motorcycle Industry Association (AISI).