Ford’s exit from Indonesia upsets its dealers image

Ford’s dealers in Indonesia are now seeking to recoup their losses after the automaker said earlier this year it would close all operations in the country.

Ford has been struggling to gain market share and to make some reasonable profits in Indonesia since its entrance in the market in 2002. Recent years have been especially challenging, as the country’s new car market started to be affected by the overall economic slowdown. At the beginning of the year, the Detroit-based automaker said it decided to exit from all segments of business, including closing dealerships and stopping sales and imports of Ford and Lincoln vehicles. The company made a similar decision for Japan as well.

Reuters reports that dealers are now looking to get around 75 million dollars in compensation, looking to take their demands to court if they are not reaching an agreement with the automaker. They are claiming they made considerable investment in their businesses to support an expansion plan that Ford announced in 2011, but which never came. When it announced the shutdown back in January, Ford said it would start talks with its dealers to implement its exit plan later in the year.

The automaker has a staff of 35 and sells its cars through 44 franchised dealerships in Indonesia, while last year it delivered around 6,000 vehicles, taking a 0.6 percent share of the total new car market. General Motors also decided to close its production operations at a local plant in Indonesia in 2015, ceasing output of locally manufactured GM-branded autos, forced by the intense competition from the Japanese brands, such as Toyota and Honda.

Via Reuters