Jakarta – Timor national car producer, PT Timor Putra Nasional,will no longer rely on special assistance from the government indeveloping its car industry, its president director, Hutomo "Tommy" Mandala Putra, said Monday.

"We will no longer need special assistance in the future becauseby achieving the 60 percent local content on the third year, we willhave tax exemptions for the import of other car components," Tommytold newsmen after the groundbreaking ceremony for the constructionof PT KIA Timor Motors' car factory in Cikampek, some 100 km east ofhere.

He expressed hope that his company would achieve a 100 percentlocal content for the Timor national car.

He is also optimistic that his company would be able to increasethe Timor's local content to 60 percent by 1999.

In February 1996 the government granted PT Timor import duty andluxury sales tax exemptions.

Import duties and the luxury sales tax, applicable to all othercar producers in the country, add about 60 percent to the prices ofcars.

The tax breaks were extended because Timor was designated asIndonesia's national car.

PT Timor was required to achieve a 20 percent local content inits first year of production, 40 percent in the second and 60percent in the third.

Since August last year, PT Timor has been importing Timor sedansfrom South Korea's Kia Motors, pending the completion of its ownproduction facilities in 1998.

Low-priced car Tommy also disclosed that PT Timor will launch in 1999 a new1000 cc sedan, the Timor S-2, to be priced at Rp 20 million.

The present 1600 cc Timor S-515 has been in the market sinceOctober last year and costs about Rp 36 million.

The company will also develop a 2000 cc jeep to be called theJ5, he added.

The jeep will be imported in completely-knocked-down (CKD) formfrom South Korea's Kia Motor to be assembled here, he said.

The price of the J5 jeep will be less than that of other jeepsin the same class, Tommy said.