Chinese carmakers dominate Indonesian electric vehicle market

author: FutureCar Staff    

Electric vehicle (EV) sales in Indonesia are expected to experience rapid growth in the near future. At the recent Gaikindo Indonesia International Auto Show, Chinese carmakers Neta Auto and Great Wall Motor showcased their sleek electric car models, aiming to tap into the increasing demand for eco-friendly vehicles in the country. The Indonesian government is actively promoting EV production and consumption, offering subsidies and incentives to boost domestic demand.

Wang Chengjie, vice president of Neta Overseas, expressed excitement about entering the Indonesian market, recognizing its huge potential for electric vehicles. Neta presented three models at the auto show and initiated pre-orders for the Neta V crossover, which received significant interest from curious onlookers. Great Wall Motor Group also drew attention with its Ora Good Cat, a compact electric hatchback with unique features.

While Japanese automakers like Toyota, Honda, Daihatsu, Mitsubishi, and Suzuki have dominated the Indonesian car market, they have been slow to introduce electric cars due to infrastructure limitations and lack of incentives. This gap is now being filled by Chinese companies. However, despite the potential for growth, EVs currently make up a small fraction of total automobile sales in Indonesia.

Several obstacles hinder the widespread adoption of electric vehicles in Indonesia, including the insufficient number of charging stations, high costs of purchasing EVs, inconsistent policies, and potential reliability issues with electricity supply in rural areas. To address these challenges, the government has introduced a subsidy program that covers the sales of electric motorcycles and cars, as well as the conversion of combustion-engine motorcycles to electric propulsion systems.

The Indonesian government also offers incentives for producers, such as zero percent export duty and value-added tax for electric cars and buses that meet certain domestic content requirements. Consumers can receive financial support for purchasing onshore electric cars, and the government aims to ensure lower ownership costs. These initiatives align with Indonesia's goal to become a major producer of EV batteries and electric cars, utilizing its rich reserves of nickel.

Competition in the Indonesian EV market is heating up, with Chinese carmakers not only competing against Japanese brands but also South Korean, American, and European players. French carmaker Citroen and Germany's Mercedes-Benz showcased their electric vehicles at the auto show, while the Indonesian government has been actively pursuing American manufacturer Tesla to invest in car and battery manufacturing in the country. However, Chinese carmakers, such as Wuling, have already gained a head start with their early investments in Indonesia.

While Chinese electric cars garnered interest at the auto show, some people expressed concerns about their quality and reliability. Arsita Kamila, for example, found the Ora Good Cat cute and practical for city driving but hesitated to purchase one due to doubts about its longevity, particularly regarding the battery.

FutureCar Staff