Steel-Producing IKMs Partner with Large Scale Industries to Strengthen Automotive Component Supply

JAKARTA – The performance of small and medium scale industries (IKM) in the steel sector have contributed positively to the national automotive industry’s supply chain.

Steel-based IKMs are one of the primary contributors to the automotive industry’s supply chain, mainly through the Logam Ceper center which operates as an IKM itself providing steel casting services and producing several products such as manhole covers, hydrants, ship components, machine spare parts, train components, heavy machinery parts and automotive vehicle parts.

To further support steel-based IKMs, the government, through the Industry Ministry (Kemenperin)’s Directorate General for Small, Medium and Miscellaneous (IKMA) Industries, have held various training programs to develop the technical competency of workers, improve product quality, assist in ISO certification and improve access to possible markets and partnerships.

“The IKMA Directorate General also encourages the elevation of IKMs’ roles at the Logam Ceper center to play a larger part in contributing to the automotive industry supply chain, for example through joining development programs such as PT Toyota Motor Manufacturing Indonesia’s (TMMIN) program with the Batur Jaya Ceper (KBJ) Cooperatives Center,” the Kemenperin’s IKMA Directorate General acting head Reni Yanita said on Wednesday (13/10).

The KBJ Center has 137 steel-based IKMs as members who produce automotive components, factory machinery components, locomotive spare parts, manhole covers, antique chairs and tables and various other steel-cast and iron-cast items. The KBJ Center Cooperatives’ partnership with PT TMMIN has operated since the end of 2016 until today.

Reni noted that the IKM center development program involving partnerships with big industry figures is expected to help IKMs become a larger part of the industrial supply chain for large-scale industries so that IKMs would be able to receive market certainty and push IKMs to upgrade the quality of their products and their business management while also meeting customer demands as well.

“Within this partnership, PT TMMIN’s role is to assist, guide and provide machinery to the Batur Jaya Cooperatives. By January 2019, the KBJ managed to produce 200 cylinder sleeves and send them directly to PT TMMIN’s suppliers,” Reni said.

So far, according to Reni, the IKMs at the Logam Ceper center have proven that they are able to diversify their products by also producing automotive components that are in line with the needs and standards of PT TMMIN’s suppliers, thereby further signifying their role in the national automotive industry’s supply chain.

“With good planning practices and good training and assistance efforts done over the past 2 years or so, IKMs here are now able to fulfill the criteria of sectors and areas that have high standard criteria in terms of product quality, productivity, technological use and supply continuity,” Reni said.

Not only that, the Kemenperin’s IKMA Directorate General continues to pledge their willingness to develop the technical skills of steel-based IKMs in Ceper through a variety of other assistance programs, involving them in programs which can help improve promotional skills and market testing such as the INAMarine (maritime industry showcase) and the link and match programs with large-scale industries.

In addition, the development of IKM operators and workers is also done through technical guidance programs on the manufacturing of composite brake blocks, as well as on diversification of ferrous and non-ferrous products. The Kemenperin’s IKMA Directorate General have also developed a program for developing the IKMs at Ceper that involves FGD Sinergi.

“The IKMA Directorate General will continue to support IKMs at Ceper to be able to become more competitive and harness new market potential, producing quality products at competitive prices and become a part of the national and global industrial supply chains,” Reni concluded.