Indonesia Considers $320 Million In Incentives To Boost EV Sales In 2023

Indonesia may allocate 5 trillion rupiah ($320.41 million) from next year's budget to incentivise electric vehicle (EV) purchases, though details of the scheme were still being finalised, a senior minister said on Wednesday.

Last week, Industry Minister Agus Gumiwang Kartasasmita said buyers could get a discount of 80 million rupiah for EVs made by firms with factories in the country, as well as other incentives for hybrid cars and electric motorcycles. The government plans to offer subsidies to sellers to cover the costs.

Airlangga Hartarto, Indonesia's chief economics minister, said at a news conference on Wednesday that authorities are detailing how much they could provide per sale based on the budget allocation.

The government is also considering subsidising electric bus sales, he said.

President Joko Widodo told the same news conference: "We hope with these incentives, the electric motorcycle and electric car industry will grow".

Indonesia targets 20% of overall car sales in 2025 to be EVs, Airlangga said.

Companies that have invested or have announced planned investments in EV manufacturing in Indonesia include Toyota Motor Corp, Mitsubishi Motors Corp and Hyundai Motor Co.

SGMW Motor Indonesia, part of a joint venture of SAIC Motor Corp Ltd, General Motors Co and Wuling Motors Holdings, has an EV assembly facility in the Southeast Asian country.

Indonesia has also tried to court U.S. firm Tesla to invest to produce not just EV batteries but also cars in the country.

Japanese brands currently dominate sales in the world's fourth most populous nation, with Toyota as the market leader. More than 942,000 cars were sold in the country in January to November this year.

($1 = 15,605.0000 rupiah)