<p>The automobile industry is the most important part of the transportation business globally. Developing countries have possibility to build one of the most hi-tech industry because of FDI inflow from automobile MNCs. Since 1974, the Government of Indonesia concerns deeply on the automobile industry and created a policy series of local component content. However, these policies created reluctance of automobile MNCs to support technology transfer from FDI spillover. The improvement of economic condition and liberalisation of imported part tax policy boosted the productivity of the automobile industry. Although, the automobile industry shows a significant improvement post-Asian economic crisis, the productivity of Indonesia is still left behind from Thailand in the ASEAN. The Government has the ambition to make Indonesia as the largest automobile producers in the ASEAN. This paper attempts to measure the influencing variables on the automobile industry productivity in Indonesia empirically. From multiple regression analysis on the period 2000 – 2017 data, the analysis results that all of the exogenous variables theoretically have the same influence sign with the previous researches. The FDI, imported parts, inflation, and lending interest rate have a significant influence on automobile production while labour does not affect productivity. The reasons why labour is not significant are the automobile industry is a capital intensive industry, and the labour of local automobile part manufacturers as a supporter industry is not included in the analysis due to data availability.</p>