Four Chinese electric vehicle (EV) manufacturers have expressed their readiness to start production in Indonesia, an official from the Coordinating Ministry for Maritime Affairs and Investment said on Thursday, Malaysian news agency Bernama reported.

The ministry’s deputy for infrastructure and transportation coordination, Rachmat Kaimuddin, said that he met with the four manufacturers in China.

“In principle, they appreciated our policy on EVs,” he said. He, however, did not provide further details regarding the four manufacturers, only disclosing the name of one of them.

“Of the four manufacturers, one has started the project, namely Wuling. They have just launched a new product. While the other three, I am not in a position to talk (about),” Kaimuddin was quoted as saying.

The four EV producers have also expressed their readiness to follow the regulations in Indonesia, including complying with the 40 percent domestic component level rule, he said.

He said that the four EV manufacturers will help Indonesia achieve its target of producing 600,000 electric cars by 2030, as targetted by President Joko Widodo (Jokowi), reported Antara.

“I have conveyed the president’s target to achieve a production of 600,000 electric cars by 2030. We welcome them to bring the products,” Kaimuddin added.

The direction is in line with Presidential Regulation Number 79 of 2023 concerning Amendments to Presidential Regulation Number 55 of 2019 concerning the Acceleration of the Battery Electric Vehicle Programme for Road Transportation, according to the report.

It also regulates tax-free incentives for EV manufacturers to import completely built-up (CBU) vehicles until the end of 2025, under certain terms and conditions.

“The regulation provides incentives to manufacturers to test the market for those who are committed to building production capacity in Indonesia,” Kaimuddin was quoted as saying.

He expressed optimism that the target of producing 600,000 electric cars by 2030 would be achieved. He said he hoped that a ministerial regulation from related ministries would be issued before the end of the year.

“We are still waiting on the ministerial regulation. Four ministries are working on this, namely the Finance Ministry, Trade Ministry, Industry Ministry, and the Coordinating Ministry for Maritime Affairs and Investment,” he added.

China’s Wuling, which builds cars in Indonesia, held a commanding 78 percent share last year in EVs, followed by South Korea’s Hyundai Motor at 20 percent, Nikkei reported in August, quoting figures from the Association of Indonesia Automotive Industries, or Gaikindo. Japan’s Toyota, including the Lexus brand, trails far behind at just 1.4 percent.

EVs, however, remain a small portion of the overall car market, accounting for just 1.16 percent of all car sales in Indonesia. In the first six months of 2023, 5,849 electric vehicles were sold against total car sales of 502,536, Gaikindo figures show, the report added.

Besides Indonesia’s domestic EV ambitions, foreign automakers are also eyeing the potentially huge market. The Southeast Asian country has more than 270 million people and the population is growing.

Vietnam-headquartered electric vehicle manufacturer VinFast also announced in September its plans to expand in seven more markets in Asia, including Indonesia. The company also targets to start deliveries from next year and set up a plant in Indonesia in 2026.

Feature photo credits: Wuling’s Facebook page

Vietnam’s EV maker VinFast plans Asia expansion; to build plant in Indonesia in 2026