At least $150 million in contracts. That's what General Motors' Indonesian operation has been worth to Indonesian firms since the company established its joint venture in 1993.

Helping Indonesian suppliers make money is part of the American automaker's basic philosophy. That's not philanthropy, it's good business sense.

"As an American company trying to establish ourselves in Asia, simple geography says that to compete in this market we have to develop a strong local supplier base," says Dr. Michael J. Orris, who oversees purchasing for PT General Motors Buana Indonesia (GMBI), a 60.40 joint venture.

"The Koreans and Japanese can afford to make a lot more of their parts at home and ship them in for assembly," he explains. "We have a six week pipeline and burdensome transportation costs."

That pragmatic strategy has meant money in the bank -- and business growth -- for almost 2,000 Indonesian suppliers.

Indonesian companies, many of them startups, are providing everything from vehicle parts to machinery on an assembly line employing 800 Indonesian workers to produce the world's first right-hand-drive Blazers, as well as Opel sedans.

GMBI's travel agency alone booked $1.3 million in business with the company in the first half of 1996.

But the numbers only tell part of the story. While GM contracts are important to many suppliers, the company's commitment to technology transfer is even more critical for the long-term development of Indonesia's auto industry.

"You hear stories about the national car," Mr. Orris adds, referring to the controversial Timor project with the Koreans, "how it is needed because other manufacturers haven't fostered the industry. Well, it's our plan to do those things not because of the Timor, but as a survival strategy."

Evaluation, training and the fostering of international partnerships are just some of the ways GMBI is working to build the local infrastructure which will allow it to complete in the Indonesian marketplace and enable Indonesian firms to compete on the world stage.

The ultimate goal is to bring local suppliers up to the standards that will allow them to bid on GM contracts around the world.

"Once a supplier qualifies and makes our master bidder's list, they are qualified to bid on every one of the international contracts, and that's big bucks," says Orris, who is also responsible for sourcing parts for GM operations elsewhere in the world.

One key to GMBI's strategy is the QS 9000, the auto industry's enhanced version of the well-known ISO 9000. GM experts have conducted more than 60 QS 9000 assessments, and the company is setting up a system of QS 9000 accreditation for Indonesian suppliers. By 1997, all suppliers for America's "Big Three" auto makers will be required to have certification.

Such evaluations, says Orris, help Indonesian companies "clearly know how they stack up against the world standards, and help up know where to focus our training."

Intensive on-site training sessions (more than 600 at last count), assistance to new companies entering the auto parts industry, have all yielded impressive results.

By the middle of 1996, defects per million on parts provided by Indonesian suppliers had dropped to just ten per cent of what they were six months before.