Indonesia accelerates the development of electric vehicle industry

2025/12/05 10:11

Indonesia's Ministry of Industry stated earlier this year that it will provide tax incentives to several automakers, including China's BYD, GAC Aion, and France's Citroën, to support their establishment of production bases in Indonesia and boost the country's electric vehicle (EV) industry. The Indonesian government aims to demonstrate its commitment to offering a favorable business environment for global investors and automakers through this initiative. Minister of Industry Agus Gumiwang Kartasasmita emphasized that the policy will help Indonesia become a key EV production hub in Southeast Asia.

Truck

In recent years, Indonesia has implemented a series of measures to promote the development of its EV industry, including corporate income tax exemptions for EV-related enterprises, reduced import tariffs, simplified business license application procedures, and guaranteed raw material supply—all of which have yielded positive results. In 2015, China's Wuling Motors, together with 16 Chinese upstream auto parts suppliers, ventured into Indonesia with an investment of approximately US$1 billion, constructing a vehicle manufacturing plant with an annual capacity of 120,000 units and a parts industrial park. Currently, the company operates around 150 sales and service outlets across Indonesia. In 2024, Chinese automakers such as Chery, BYD, and GAC Aion announced plans to build EV assembly and battery manufacturing facilities in the country.

Indonesia is endowed with abundant mineral resources such as nickel, tin, cobalt, copper, and bauxite—with nickel and cobalt being essential raw materials for EV power batteries. The Indonesian government is leveraging its resource advantages to develop a complete EV industrial chain and establish itself as a regional hub for EV battery production. In recent years, companies like CATL and Foxconn have partnered with Indonesian enterprises to build integrated EV and battery supply chains, covering nickel mining and smelting, battery material production, and recycling.

Truck

Last July, Southeast Asia's first EV battery factory officially commenced operations in West Java, Indonesia. Former Minister of Investment Bahlil Lahadalia noted that the factory would help Indonesia become the first country in Southeast Asia with a comprehensive EV ecosystem. In August 2023, a lithium-ion battery anode material factory invested by China's BETTERURE New Materials Group began production in Kendal Industrial Park, Central Java. With an annual capacity of 80,000 tons, the factory can meet the demand for 1.5 million EVs, filling Indonesia's gap in lithium-ion battery anode material production. Former Indonesian President Joko Widodo stated that Indonesia is building an integrated EV ecosystem with the assistance of Chinese enterprises, integrating into the global EV supply chain.

Truck

The Indonesian government also attaches great importance to the construction of EV supporting infrastructure. As of December 2023, Indonesia had 2,667 EV charging stations. The government plans to increase this number to nearly 50,000 by 2030. Many Indonesian EV-related enterprises are strengthening international cooperation to develop charging facilities and services. Last July, six Indonesian charging operators partnered with Hyundai Motor to establish an EV charging alliance, allowing users to access charging services from different operators via a mobile app.

Truck

According to the Indonesian government's plan, the number of EVs and electric motorcycles in the country is expected to reach over 2 million and 13 million respectively by 2030. As reported by Indonesia's Jakarta Post, Indonesia is actively promoting green transportation, a trend that aligns with global sustainable development initiatives and reflects the government's commitment to achieving net-zero emissions. A senior official from Indonesia's Ministry of Transportation stated that the transition to EVs not only provides strategic opportunities for national economic growth and energy security but also helps improve air quality, reduce carbon emissions, and deliver economic benefits to the public.