REPUBLIKA.CO.ID, JAKARTA -- Coordinating Minister for Economic Affairs Airlangga Hartarto confirmed Indonesia's readiness to become prominent electric vehicles manufacturer in the global market.

“The development of Indonesia's Battery-Based Electric Motor Vehicle (KBLBB) industry is currently gaining good momentum because it is supported by Indonesia's full resources, we are the largest producer of nickel metal mineral materials in the world,” Airlangga said during the inaugural production ceremony of Omoda 5 Electric Vehicle (EV) in Bekasi, some time ago.

As an effort to accelerate EV production in Indonesia, Menko Airlangga appreciated the commitment of PT Chery Motor Indonesia and PT Handal Indonesia Motor to realize EV production in Indonesia.

“The contribution will contribute to the development of the transforming automotive industry towards an era of electrification and eco-friendly ecosystems,” he said.

Airlangga also expressed its hope that with the start of the first production of the Omoda 5 EV car, this car will be able to diversify the type of electric car in Indonesia and provide more choice alternatives for consumers.

“I also look forward to Chery Indonesia to consider the production of electric cars in Indonesia as an export base, including for the markets of Vietnam, the Philippines, and Australia. The EV and battery ecosystem is complete, so Indonesia is quite efficient as an EV manufacturer for the global market. Therefore, we are waiting for the launch of the product, and continued investment is also awaited by the government,” he said.

According to him, the development of electric vehicles in Indonesia will be more massive in the future as investments from electric vehicle manufacturers flow. Until the beginning of the 4th quarter 2023, electric car's domestic sales were recorded at 11,916 units.

According to the ERIA study, the potential benefits by 2040 that Indonesia will gain through fuel import savings with the implementation of electric cars/BEV could reach 15 billion US dollars and electric motorcycles 10 billion US dollars. In addition, Indonesia has also explored the potential of hydrogen fuel cells as part of efforts to promote sustainable and clean energy solutions without emissions.

Several incentives have been issued by the government to accelerate the implementation of EVs in Indonesia. Among them is aid incentives for new two-wheeled EVs and conversions worth Rp7 million, then the government-borne value added tax incentive (PPN-DTP) for electric cars and buses with a TKDN value of at least 40 percent, it will be given a VAT incentive of 10 percent for electric cars and for electric buses with a TKDN of more than 20-40 percent will be given a VAT incentive of five percent.

“With products already using local content reaching 40 percent, we expect Chery will be able to penetrate the market faster with fiscal facilitation from the government,” he said.

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