Coordinating Minister (Menko) for Economic Affairs, Airlangga Hartarto, revealed that currently the Indonesian automotive industry has a production capacity of over 2 million with a labor absorption capacity of 1.5 million.
“Currently, the strength of the automotive industry in Indonesia is supported by 26 four-wheeled motor vehicle industry companies, their production capacity is above 2 million and this industry absorbs 1.5 million workers,” said Airlangga, quoted Friday (1/12/2023 ).
Furthermore, Coordinating Minister Airlangga emphasized that the Government is encouraging the development of the Electric Vehicle (EV) ecosystem.
“Indonesia is committed to reducing carbon emissions by 358 million tonnes of CO²e in 2023. Of course the electric vehicle roadmap is important,” said Coordinating Minister Airlangga.
The development of the Indonesian electric vehicle industry is currently gaining good momentum which has been supported by the condition of Indonesia which is the world’s largest producer of nickel metal minerals as raw material for EV batteries.
“The development of electric vehicles in Indonesia is of course important because investment continues to increase and sales of electric motorbikes have also increased,” explained Airlangga.
Several incentives have also been issued by the Government to accelerate the implementation of battery-based electric motorized vehicles in Indonesia, including government assistance incentives for new 2-wheelers and conversions worth IDR 7 million, then VAT-DTP incentives for electric cars and electric buses with a minimum TKDN value 40% will be given a VAT incentive of 10%, while for electric cars and electric buses with TKDN 20%-40% they will be given a VAT incentive of 5%.
Apart from that, currently Indonesian MSMEs have collaborated with the Busan Economic Promotion Agency (BEPA), South Korea. The scope of this collaboration is the RnD technology center for electric vehicles.
This MoU of cooperation is expected to be an important point, to increase the role of Indonesian MSMEs/IKM in the EV ecosystem.
“Hopefully this event will run smoothly, can spur and navigate Indonesian MSMEs to be more proactive and progressive in improving performance and responding to every existing challenge,” concluded Coordinating Minister Airlangga.