STRATEGY AND POLICY OF AUTOMOTIVE INDUSTRY IN INDONESIA

Jakarta,  23 February 2023

Director of Maritime, Transportation and Defence Equipment Industries
1. OVERVIEW OF INDONESIAN AUTOMOTIVE INDUSTRY
 ECONOMIC GROWTH

Economic Growth Purchasing Manager Index
5,31
5,17 5,02 Expansion57,2
53,9 53,5 53,7 53,7
52,2 51,2 51,3 51,9 50,8 50,2 51,3 51,7 51,8
50,3 50,9 51,3
3,7

2018 2019 2020 2021 2022

‐2,07

Manufactured Industry Confidence Index (IKI)
5,01% Automotive Sector
10,67%
Source: BPS processed by MOI Above the growth of manufactured sector
51,54 Jan 2023
50.9 Des 2022

 Indonesia's economic growth increased in 2022 compared to 2021 by 5.31%. The growth rate of Automotive sector was 10.67%, exceeding the
manufactured's growth rate of 5.01%.
 In January 2023, Indonesia's IKI level was 51.54, an increase of 0.64 points. While the Indonesian PMI score for January 2023 is 51.3 points, this number
indicates the state of the manufactured industry and the prospects for business conditions in the upcoming six months in an expansionary state. Since
September 2021, Indonesia's Manufacturing PMI has been on an expansionary phase for 17 straight months.
 The high values of PMI, IKI and Indonesia's economic growth prove that the Indonesian economy is getting better, especially in the manufacturing
industry
 OVERVIEW OF INDONESIAN AUTOMOTIVE INDUSTRY

272 Million People

68.7 %
Group of Productive Age

Manufacturer  Production  Production  Total Direct  Total Investment  Ownership  GDP per Capita (USD)
Quantity (Unit) capacity Labor until 2022 Ratio
4136 4050
3894 3979
3838
99 units/ 3563
26 Companies 2020: 0,69 Million 2.35 Million  38.39  Rp. 143.16 
2021: 1.21 Million Thousand 1000 
Units/Year Trillion
Population
2016 2017 2018 2019 2020 2021*

53 Companies 2020: 4,36 Million 9.21 Million  30.30  Rp. 30.39  1 Units/ 

2021: 5,86 Million Thousand Trillion 4 Population
Units/Year

 Indonesia is the largest automotive market in Southeast Asia

 The car ownership ratio of 99 cars per 1000 people indicates the auto industry have a good business prospect
 Car sales in Indonesia are mostly priced at Rp. 200‐300 million, where this is influenced by Indonesia's GDP per
capita which is still in the range of USD 4000

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 ASEAN AUTOMOTIVE INDUSTRY OVERVIEW

Indonesia is the largest market in ASEAN with a

contribution of 30,1% based on market share in 2022
Indonesia also has the largest population and has a
relatively small ratio of vehicle ownership

ASEAN CAR MARKET SHARE 2022
Singapore
Phillipines 42.550 Units
352.596 Units

INDONESIA
Vietnam 1.048.040 Units
404.635 Units 30.6%

Malaysia
720.658Units

Thailand
849.388 Units

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Sumber:GAIKINDO
2. STRATEGY AND POLICY OF EV DEVELOPMENT IN INDONESIA
 PROJECTION OF THE NUMBER OF ICE VEHICLES (4 WHEELER OR MORE) OPERATION IN INDONESIA

CO2 (Million ton)

UIO (Million unit)
Note:
1. 50% sales growth (impact of PPnBM DTP stimulus), CAGR in 2022‐2030
at 5.5%
2. CO2 emissions are calculated from the type of vehicle (LCGC, Sedan,
MPV, SUV, Pick Up, Bus, and Truck) and engine capacity (cc)
3. The above projection does not take into account the penetration of
KBLBB and other low emission vehicle technologies
G: Gasoline, D: Diesel, UIO: Unit in Operation

Source: Ministry of Industry Internal Analysis, GAIKINDO, EV Comprehensive Study,

Natural Gas Engine Technologies: Challenges and Energy Sustainability Issue, MDPI
Automotive technology innovations to reduce CO2 emission 
Technology CO2 Reduction Add. Price Challenges
HEV 49% LOW ‐
PHEV 74% HIGH OTR Price and charging station
xEV
BEV 100% HIGH OTR Price and charging station
FCEV 100% HIGH OTR Price, Hydrogen Station, Hydrogen Price
CNG Vehicle 20‐30% LOW CNG specification, CNG station
Flexy Engine Vehicle (Biofuel)  100% (carbon neutral) LOW Biofuel specification

• Based on the Ministry of Industry's internal projections, the number of ICE vehicles circulating in 2030 is 25.8 million units, producing 92.2 million tons 
of CO2 emissions.
• In order to support the reduction of CO2 emissions, the Ministry of Industry issued a policy for the development of a low carbon emission motorized 
vehicle industry which is regulated in Permenperin No. 36 Year 2021
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 Development of Environmentally Friendly Vehicle Production

The government regulates the production of environmentally friendly vehicles through Minister of Industry 
Regulation No. 36 of 2021 concerning the requirements for the Low Carbon Emission Vehicle (LCEV) 

Low Carbon Emission Vehicle
Plug‐in Hybrid Electric Vehicle (HEV)
Low Cost Green Car (LCGC) • Engine : ICE dan Electric Motor
• Engine : ICE PHEV • Energy sources: Fossil Fuel dan Electricity
LCGC • Energy sources: Fossil Fuel • Storage : Fossil Fuel Tank, Battery (medium capacity), can be 
• Storage : Fossil Fuel Tank charged (SPKLU)

Flexy Engine Vehicle 
FLEXY  Battery Electric Vehicle (BEV)
• Engine : ICE
ENGINE • Engine : Electric Motor
• Energy sources: Bio Fuel
BEV • Energy sources: Electricity
• Storage : Bio Fuel Tank
• Storage : Battery (medium/big capacity), can be charged 
(SPKLU)

Hybrid Electric Vehicle (HEV)
• Engine : ICE dan Electric Motor
HEV
• Energy sources : Fossil Fuel dan Electricity
• Storage : Fossil Fuel Tank, Battery (small  FCEV
capacity)
Fuel Cell Electric Vehicle (FCEV)
• Engine : Electric Motor
• Energy sources: Hydrogen (converted into electric power by the 
fuel cell)
• Storage : Hydrogen tank, Battery

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 ACCELERATION OF THE KBLBB PROGRAM FOR ROAD TRANSPORTATION

Indonesia's Commitment to Addressing Climate Change in the Paris Agreement Framework

“Reducing Greenhouse Gas (GHG) emissions by 29% by 2030 (with own efforts) and
by 41% (if receiving international assistance)”

GOVERNMENT REGULATIONS MOI REGULATIONS

Presidential Decree Number 55/2019:
1. the Acceleration of the Battery Electric Vehicle • Minister of Industry Regulation Number 36/2021:
Program for Road Transportation Development and requirements for the Low Carbon
Emission Vehicle (LCEV)
Government Regulation Number 73/2019 JO
2. National  • Minister of Industry Regulation Number 6/2022: 
Tax 74/2021:
concerning Luxury Tax (PPnBM) of Motor Vehicles Specifications, Development Roadmap, and  Calculation 
of Domestic Component Level for Battery Electric 
Law Number 1 tahun 2022: Vehicles
3. Regional
Tax
Exemption of Motor Vehicle Tax based on • Minister of Industry Regulation Number 28/2020 and
Renewable Energy for the regions and the center 7/2022:
Battery Electric Vehicles In CKD and IKD
Presidential Instruction Number 7 tahun 2022:
4. Government  Use of BEV as Operational Service Vehicles
Vehicle
and/or Individual Vehicles for Central
Government and Regional Governments
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 EV DEVELOPMENT ROADMAP

• The EV Development Roadmap contains a guide to mastering the main components of a motorized vehicle which includes batteries, electric motors and 
converters.
• Battery Industry Development is divided into battery assembly industry, cell battery production, battery management system (BMS) manufacturing, battery 
material mining and battery recycling (end of life/recycling), so that in the end Indonesia will have an industry integrated battery.
• The deepening of the structure of the electric vehicle industry is required through a gradual increase in the value of the domestic content level (TKDN) until 
2030.
• Production stages start from the popularization process through limited CBU imports, Completely Knock Down (CKD) Importation, followed by Incompletely 
Knock Down (IKD) and Part by Part Importation to obtain maximum added value in the country. 10
 ELECTRIC VEHICLE INDUSTRY DATA

QUANTITATIVE TARGET ACCORDING  BEV REGISTRATION 2015 –
TO PERMENPERIN NO 6 2022
ELECTRIC VEHICLE INDUSTRY PROFILE
6 February 2023 (UNITS)
Motorcycle : 36,828
Passenger car : 12,126
5 Million Barrel/
3 Wheeler : 291
2025 400.000 1.84 Million ton CO2
Companies  Production 
Total Investment
Bus : 77
Quantity Capacity
2030 600.000
7.5 Million Barrel/ Commercial Vehicle        : 10
2.76 Million ton CO2

2035 12.5 Million Barrel/  4 Companies

2,480 Units / 
Rp 0,36 Trillion  TOTAL : 49,332 Units
1.000.000 4.6 Million ton CO2
Tahun
Electric Bus Source : Vehicle Type Approval (VTA) Kemenhub

29,000 Units 
3 Companies Rp 2.102 Trillion
/Tahun
SPKLU (UnitS)
Electric Car
9.43 Million Barrel/  PERMEN ESDM NO 13 tahun 2020
2025 6 Million 3.45 Million ton CO2 1.04 Million 
Rp. 0.67 Trillion
43 Companies Units/Tahun
14.2 Million Barrel/ 
Electric Motorcyle 31.859 
2030 9 Million 5.18 Million ton CO2

18.9 Million Barrel/ 
TOTAL INVESTMENT : Rp 3.069 T
2035 12 Million 6.9 Million ton CO2 6.318 
572 

2021 2025 2030

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 EV GOVERNMENT PURCHASING ROADMAP

• In Order to accelerate EV Industry demand, Government will stipulate regulation concerning EV Purchasing Roadmap
• This roadmap aim to reduce dependency of domestic oil import to achieve renewable energy use and also to support the
governments commitment in Paris COP 21.
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 INDUSTRIAL INVESTMENT OF BATTERY

- The collaboration battery cell factory between Hyundai Group, LG and PT

Industri Batteries Indonesia (IBC) has a first phase capacity of 10 GWh
PT HKML and an investment value of up to USD 1.1 billion..
- The Industrialization of nickel will significantly increase the added value of
Consorsium:
nickel ore with an added value of 11 fold.
• Hyundai Motor Company,
• KIA Corporation, - The electric car battery factory is planned to be completed in April 2023
• Hyundai Mobis, and can start commercial production to meet the needs of electric car
• LG Energy Solution factories in 2023.
• PT Industri Baterai Indonesia atau
Indonesia Battery Corporation (IBC) - The battery cell industry will supply ±150,000 to.d. 170,000 electric
vehicles.
- The electric car battery factory is expected to be able to absorb a
workforce of ± 1,800 people.

PT International Chemical 
- Currently, PT International Chemical industry has a production capacity
Industry (INTERCALLIN ‐
of 100 MWh per year (equivalent to 9 million cells), with a total production
ABC Battery) capacity target of 256 MWh per year (equivalent to 25 million cells).

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TERIMA KASIH