The Indonesian Electric Vehicle Market is Projected to Reach IDR 30 Trillion in 2029
Maximize Research projects that the Indonesian electric vehicle market will reach a value of around US$2.02 billion, or the equivalent of Rp.30 trillion.
The market value of Indonesia’s electric vehicles is said to have reached US$533.19 million or around Rp7.93 trillion in 2020. This figure is expected to grow with a compound annual growth rate (CAGR) of 20.96 percent until 2029 so that the value can reach US$2.02 billion.
The Maximize Research report highlights the key dynamics driving the growth of the electric vehicle market. The abundance of natural resources that Indonesia has, such as nickel, is an important component in the production of electric vehicle batteries.
In addition, Indonesia also has an ambitious roadmap to become a major player in the electric vehicle sector. The government also launched various programs to support the development of the electric vehicle industry.
Furthermore, the research also emphasizes that various incentives provided by the government, such as tax breaks and favorable regulations, are factors that attract investors to the Indonesian electric vehicle industry. For example, two conglomerates from South Korea, Hyundai and LG, have invested US$1.1 billion.
Skyrocket in the future
Sales of electric vehicles in Indonesia will skyrocket in the future, with an estimated 250,000 units in 2030 or 16 percent of all new car sales.
The demand for electric motorbikes is also said to increase to 1.9 million units in the same year, or 30 percent of all sales of two-wheeled vehicles.
The potential for Indonesian electric vehicles shown by the Maximize Research report is in line with the growing trend in recent years. Even though the numbers are not large, the increase in sales of electric cars in Indonesia is quite noticeable.
Throughout 2022, the Association of Indonesian Automotive Industries or Gaikindo reported the distribution of more than 10 thousand units of electric cars. This figure has increased 10 times from 2021, which only exceeded 1,000 units.
The emergence of many locally made electric car products in Indonesia can attract consumers to switch to electric vehicles. However, electric cars are still not the people’s first choice due to a number of limitations, such as the lack of public electric vehicle charging stations.