Indonesian company feeling the pain of Ghosn’s arrest

JAKARTA: The impact from the arrest of Nissan Motor Co’s chairman Carlos Ghosn has spread all the way to Indonesia.

Shares of PT Indomobil Sukses Internasional, which distributes Nissan cars in South-East Asia’s biggest economy, posted a 7% decline in two days as uncertainty surrounds the world’s largest car alliance.

In April 2017, Ghosn told Bloomberg Television that Nissan and Mitsubishi Motors Corp aimed to at least double their market share of 7% to 8% in South-East Asia.

Both Japanese companies had started sharing logistics in the Asean region and Mitsubishi Motors may use its new multipurpose vehicle platform to supply products to Nissan in Indonesia next year.

With Ghosn’s arrest, investors are concerned about the outlook for Indomobil.

The Indonesian introduction of the Nissan Grand Livina model, based on the Mitsubishi Xpander, could be delayed amid the current turmoil, according to Andrey Wijaya, an analyst at RHB Sekuritas Indonesia. “Indomobil is expected to offer the new Grand Livina in the first quarter and investors have been expecting the new model could boost sales at Indomobil,” Wijaya said.

More than 80% of Indomobil’s revenue this year comes from the automotive business.

The company also distributes other car brands including Suzuki Motor Corp and controls at least 11% of the domestic market share, according to data from Indonesia’s automotive industry association.