Suzuki Links Car Price War to Employee Layoffs in Indonesia

KatadataOTO – The Ministry of Industry (Kemenperin) has urged several Japanese automotive manufacturers not to carry out layoffs (PHK) of their domestic employees.

The phenomenon of layoffs is no longer a new thing amidst various economic challenges. However, manufacturers are expected to avoid this possibility.

However, many difficulties await, such as the price war for cars that is rampant in Indonesia, especially after the arrival of various brands from China.

Suzuki Indonesia, as one of the manufacturers, revealed how the car price war is indirectly related to layoffs in the automotive industry.

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Especially amidst declining sales or weakening public purchasing power, many models ultimately fail to reach their target consumers, particularly among first-time car buyers.

“Of course, we are not the only ones who suffer because production is down; automatically, the fixed cost also has to be borne higher for each unit,” said Shodiq Wicaksono, Managing Director of Suzuki Indomobil Motor (SIM) in Tangerang some time ago.

Facing this situation, Shodiq revealed that efficiencies have been implemented in their assembly facilities.

According to him, Suzuki has been trying not to carry out layoffs, especially since the Covid-19 pandemic in 2020.

“That is our commitment. Efficiency and so on are one of our ways to reduce costs while still being able to pay (employees),” Shodiq affirmed.

He further explained that Suzuki once invited a number of suppliers to visit Japan to see the production process and gain new knowledge related to efficiency.

“So we stimulate and provide examples, maybe this way it can be cheaper, change sourcing, then make the process more efficient. If not, it would certainly be difficult,” said Shodiq.

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For your information, retail car sales (from dealer to consumer) as of July 2025 increased slightly from June to 62,770 units.

Meanwhile, wholesales or distribution from the factory to dealers amounted to 60,552 units, starting to experience an increase of about 4.5 percent from 57,799 units in June.

Suzuki itself recorded wholesales of 6,010 units and retail sales of 5,504 units. In terms of retail sales, Suzuki ranked third, just above Honda.